The Achieving a Better Life Experience Act (ABLE Act) was signed into law in 2014. The ABLE Act changed the U.S. tax code to create tax-free savings accounts for eligible people with disabilities. Money can be added to these accounts without fear the account holder’s public assistance will be affected. In Michigan, these accounts are known as MiABLE accounts. The Michigan Department of Treasury is in charge of the MiABLE Program. Investment services are managed by an organization called TSA Consulting Group.
People can use money from MiABLE accounts to pay for “qualified disability expenses” and other expenses that are medically necessary. Some examples of expenses include housing and transportation. To learn more, read Qualified Disability Expenses on the MiABLE website.
The money from these accounts doesn’t replace benefits the account holder would get from other sources like Supplemental Security Income (SSI) and Medicaid.
People who qualify for MiABLE accounts can choose between seven different investment options. The Checking Option is a regular, FDIC insured checking account. The other six options (Aggressive, Moderately Aggressive, Growth, Moderate, Moderately Conservative, and Conservative) all put money in mutual funds. These options have different investment risk levels. To learn more about each of these account options, read Investment Options to Fit Your Needs on MiABLE’s website.
Who Is Eligible?
An applicant must have a disability that started before they turned 26. If they are getting SSI or Social Security Disability Insurance (SSDI), they will likely automatically be eligible. If they are not getting SSI or SSDI, they can still be eligible if their disability meets the criteria set by the Social Security Administration. They must also get a “disability certification” from a medical doctor (M.D. or D.O).
To learn more about eligibility, call MiABLE customer service at (844) 656-7225. Customer service representatives are available Monday through Friday, from 8:00 am to 5:00 pm. These employees have been trained to help people with disabilities. You can also ask for help by using their contact us page.
An applicant does not need to be under 26 when they apply for their account, but they must have been diagnosed with the disability before their 26th birthday. An applicant does not have to be a Michigan resident to get a MiABLE account. Not every state offers ABLE accounts, so people who qualify for an account but live in a state that doesn’t offer them can apply for an account in a state that does.
The MiABLE website has support information and the forms people need to apply and maintain their accounts.
How Do I Get an Account?
Complete the enrollment form online on the MiABLE website. If you would prefer to download the form and complete it by hand, you can do that. Send the completed form to TSA Consulting Group, Inc. The mailing address is on the top of the enrollment form.
There is a minimum enrollment deposit of $25 that is due when the account is opened.
ABLE Account Limits
Every eligible person can only have one MiABLE account. There are limits on how much can be deposited into an account on an annual basis and the total amount the account can hold. The annual deposit amount is capped at $16,000. However, account holders who have jobs can deposit an amount equal to their current-year gross income (wages). The amount from wages is capped at $12,060. Family members are often the ones who make electronic deposits into a MiABLE account.
The account can hold up to $100,000 and still not affect the account holder’s benefits. If the account has more than $100,000, and the account holder is getting SSI, it will affect their benefits. Their SSI benefit will be suspended until the total amount in the account drops back to $100,000 or below.
MiABLE accounts have a special tax exempt status. This means the maximum amount allowed in MiABLE accounts is $500,000.
There are limits as to what you can pay for with money from your MiABLE account. You can only use money from your MiABLE account to pay for “qualified disability expenses” and other expenses that are medically necessary. If you use the money to pay for other expenses, you may have to pay taxes on that money. To learn more, read Qualified Disability Expenses on the MiABLE website. You can also contact MiABLE customer service at (844) 656-7225 or use their contact us page.
Accessing Your Money and Fees
Your account can be managed completely electronically. This means you can make deposits and withdrawals electronically from the MiABLE website.
If you choose the checking option, you will get a MiABLE debit card within 10 days after applying. You can also use that card at any Fifth Third Bank ATM to withdraw cash without a fee. You can order checks for MiABLE accounts for a $6 fee.
There is an annual fee of $60. This fee is broken up into automatic quarterly payments of $15 that are taken from your account. The payments are made during the first week of each calendar quarter. That means the payments will be made the first week of January, April, July and October of every year.
If you choose the checking account option, you will need to pay a $2 monthly service fee. You can get this fee waived if you enroll in the electronic statement delivery service for the checking account. You can also get this fee waived if you keep an average monthly balance of at least $250.
If you choose an investment account other than the checking option, you will need to pay an annual asset fee. This is a percentage of the total amount that is in your account. The percentage will be different depending on the investment type you choose. To learn more about the different type of account options, read Investment Options to Fit Your Needs on MiABLE’s website.