Author: Terry Severson, Director of Marketing, First National Bank

We’re wishing a very happy birthday to the ABLE Act, which turns four this year. The ABLE Act, which stands for the ‘Achieving a Better Life Experience’ Act, was created in 2014 as an amendment to the 529 education savings plan. It provides individuals and families with a tax-deferred savings option for qualified disability-related expenses. It’s the reason why the Enable Savings Plan exists today.

If you’re looking to brush up on your ABLE Act knowledge, read up on the fast facts we put together below:

What does the ABLE Act cover?

The ABLE Act covers disability-related expenses including education, housing and transportation, legal fees and basic living expenses. It can be used in conjunction with the benefits provided through private insurance, Medicaid, Supplemental Security Income (SSI) and other resource-based benefits. The Arc—the national community-based organization advocating for people with intellectual and developmental disabilities—compiled a comprehensive list of qualified disability expenses. The full list can be found here.

Why was the ABLE Act created?

Many individuals with disabilities and their families rely on a range of public benefits for assistance with living costs and medical fees. Before the ABLE Act, the extra and often significant costs of living with a disability were not considered when determining eligibility for these public benefits. In fact, if an individual had anything over $2,000 in savings, they would be registered ineligible for programs like Medicaid and SSI.

The ABLE Act was created to address this issue by allowing individuals the opportunity to set aside funds for qualified disability-related expenses without endangering their eligibility for public benefits.

How was the ABLE Act initiated on the state level?

When Congress passed the ABLE Act in 2014, the legislation was approved on the federal level. However, ABLE also had to be approved on the state level before it was fully instituted. Nebraska moved swiftly and helped lead the charge, and in 2016 became the third state to launch a plan—the Enable Savings Plan.

Is there a limit on the total funds that I can contribute to an ABLE account?

Each state’s Section 529 college savings program sets a maximum aggregate limit for ABLE accounts. For Nebraska, this limit is set to $400,000, with the total annual contribution limit being $15,000. Contributions that exceed the limit will be returned to the contributor. If an Enable Savings Plan account has reached the maximum limit but funds are withdrawn due to qualified disability expenses, the account will be able to accept new contributions up to the limit.

What sets apart the Enable Savings Plan from other states’ ABLE programs?

The Enable Savings Plan is available to residents in all 50 states and offers a host of benefits, including tax-free earnings on contributions, and a state income tax deduction for eligible Nebraska residents. The Enable Savings Plan does not charge fees for enrollment, withdrawals, changes to Investment Options or online transactions, allowing accounts owners to maximize their savings.

Because of the ABLE Act, the Enable Savings Plan has the ability to provide individuals and their families with savings options for disability-related expenses, ensuring that all account owners have equal opportunity to set themselves up for the future and achieve their dreams. For more information on the Enable Savings Plan, visit: