In July 2025, the passage of the One Big Beautiful Bill (OBBB) marked a major milestone for the disability community. By permanently embedding the ENABLE Act into federal law, the OBBB secured the future of several key ABLE account provisions that were previously set to expire. This article explores the fundamentals of ABLE accounts and how the OBBB strengthens their role in financial planning.
What Is an ABLE Account?
An ABLE account, short for Achieving a Better Life Experience, is a savings account that allows individuals with disabilities to set aside funds for qualified expenses without affecting their eligibility for means-tested benefits. Modeled after 529 college savings plans, ABLE accounts were established under the Stephen Beck Jr. ABLE Act of 2014, signed into law by President Obama.
To qualify, the individual must have a disability that began before age 26 (changing to age 46 effective January 1, 2026, under the ABLE Age Adjustment Act). The account can be used for a wide range of expenses, including housing, education, transportation, healthcare, employment support, and assistive technology.
Funds in an ABLE account grow tax-free, and contributions can be made by the beneficiary, family members, friends, or even through rollovers from other accounts like 529 plans. Most states allow out-of-state residents to open ABLE accounts, and many offer debit cards for easy access and recordkeeping.
Contribution Limits and Benefit Protections
In 2025, the annual contribution limit for ABLE accounts is $19,000, with an additional $15,060 allowed for employed beneficiaries who do not participate in a workplace retirement plan. States set their own total maximum account limits, ranging from $235,000 to $596,925. Money from the beneficiary’s special needs trust moved into their ABLE account will have no tax consequences, while staying within the ABLE annual contribution limit.
Importantly, up to $100,000 in ABLE savings is excluded from SSI resource calculations. If the account exceeds this threshold, SSI benefits may be suspended, but Medicaid eligibility remains unaffected, even if SSI is paused. This is where the ability to move money between a special-needs trust and an ABLE account is critical. It allows ABLE account owners on SSI to move money to their special needs trust to stay under the $100,000 threshold to avoid having their SSI suspended. Conversely, money may be moved from a special-needs trust to an ABLE account to take advantage of the ABLE account’s flexibility for qualified disability expenses, such as housing, without affecting SSI benefits.
Additional resources for understanding ABLE accounts can be found at ABLE National Resource Center (www.ablenrc.org) and ABLE today (www.abletoday.org).
The New Lifeline for ABLE Accounts
The latest enhancements to ABLE accounts were originally outlined in the ENABLE Act, a standalone bill. Those provisions were incorporated into the OBBBA and signed into law on July 4, 2025.
Passage of the new law made permanent several provisions that were previously temporary, ensuring long-term stability for ABLE account holders.
- ABLE to Work
This provision allows employed individuals with disabilities to contribute beyond the standard annual limit, provided they do not have access to a workplace retirement plan. It encourages financial independence and rewards employment.
- ABLE Saver’s Credit
Low and moderate income individuals who contribute to their ABLE accounts may qualify for a tax credit, helping to offset the cost of saving and incentivizing consistent contributions.
- 529-to-ABLE Rollovers
Families can now permanently roll over unused funds from 529 college savings plans into ABLE accounts without incurring tax penalties, provided the beneficiary is the same or a qualifying family member.
These provisions were previously set to expire but are now permanent, thanks to the ENABLE Act’s inclusion in the OBBB.
ABLE Accounts Resources
ABLE National Resource Center
www.ablenrc.org
ABLE today Parent-to-Parent matching
www.abletoday.org
Looking Ahead: Planning with Confidence
With the ENABLE Act now permanently embedded in federal law, ABLE accounts are more powerful than ever. Financial professionals, disability advocates, and families should revisit their planning strategies to take full advantage of these updates.
Key takeaways:
- ABLE accounts offer tax-free savings for disability-related expenses.
- Contributions up to $19,000 annually (plus $15,060 for employed beneficiaries) are allowed in 2025.
- SSI is unaffected up to $100,000 in ABLE savings; Medicaid remains unaffected regardless of balance.
- The OBBB makes permanent the ABLE to Work provision, Saver’s Credit, and 529 rollovers.
As the landscape of disability financial planning evolves, ABLE accounts remain a cornerstone of independence, dignity, and opportunity.
SpecialCareSM is a program created by MassMutual that provides access to information, specialists and financial solutions to people with disabilities and their families. For more information about Massachusetts Mutual Life Insurance Company (MassMutual) and its SpecialCare program, please visit www.massmutual.com/specialcare.
The information provided is not written or intended as specific tax or legal advice. MassMutual, its subsidiaries, employees, and representatives are not authorized to give tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel. Individuals involved in the estate planning process should work with an estate planning team, including their own personal legal or tax counsel.
ABOUT THE AUTHOR:
Kelly Piacenti is Head of MassMutual’s SpecialCare program with nearly 500 Special Care Planners. She oversees partnerships with some the largest national special needs non-profit organizations and serves on the National Board of Directors for United Cerebral Palsy. She also serves on the Advisory Board for The Academy of Special Needs Planners, as well as The American College Center for Special Needs Planning. Kelly often lectures at industry conferences and is published and quoted in numerous industry publications for the special needs community. She has four children and was the mother of a son with special needs for 19 years.
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