ABLE Accounts are an important way for individuals with disabilities to build financial stability without losing vital benefits, without which they could not address their health care and disability support needs. This FAQ by the DC Developmental Disabilities Council contains broad enough information to be useful to individuals and families considering ABLE Accounts nationwide, and to the providers who support them in decision-making.
“Frequently Asked Questions about COVID-19 Stimulus Payments and ABLE Accounts
What is the stimulus payment I am receiving?
The federal government approved a special payment to people to spend any way you want to help the country during the COVID-19 pandemic. However, the payment MUST be spent or put into an ABLE savings account within 12 months or it will count as an asset and could reduce your benefits. Each individual will receive $1,200, and those with qualifying children will receive an additional $500 per child. People who receive disability payments from Social Security (SSI) will get their payment the same way they get regular SSI payments each month, either by paper check or direct deposit. Many people have already received these payments.
Beware of scams! The IRS will not call or email you about the stimulus payment. Do not share your personal information on the phone or over email.
Can I deposit the stimulus payment into an ABLE Account?
Yes! You can put all or part of your stimulus payment into an ABLE account. That way, you do not have to worry about spending the money right away. Putting the payment in an ABLE account can give you flexibility. Plus, it will have the same benefits protection as all contributions made to an ABLE account.
Why should I consider putting some, or all, of this payment into an ABLE account?
An ABLE account can help you save for things that are not covered by SSI benefits. If you do not need to use the stimulus payment for things right now, you could use it to start saving. You can save for whatever you need to be independent and participate in your community. That includes adaptive equipment, a vehicle, a home, assistive technology, personal support services, and many other expenses. You can also use an ABLE account to save for emergencies.
Do I have to use the stimulus payment on things related to my disability?
No. The stimulus payment is NOT a payment from Social Security. You do not have to follow Social Security rules when you spend it. Your stimulus payment can be used in any way you choose. You could use your payment now. You could spend it within 12 months. You could save all or part of it in an ABLE account to give you more time to spend it while preserving your benefits.
Will the stimulus payment disqualify me from the benefits I need?
Not for 12 months. After a year, whatever is left will count toward your $2,000 SSI asset limit if you leave it in other savings account. If you save it in an ABLE account, it will not count toward your $2,000 asset limit. ABLE accounts are different from other savings accounts because an ABLE account can fund disability-related expenses and the assets in the ABLE account are not counted to determine your eligibility for Social Security benefits.
How does an ABLE account help me keep from exceeding my $2,000 asset limit?
Funds in your ABLE account are not counted toward your $2,000 asset limit. You will not lose your benefits or lose eligibility for federal benefits (like SSI, SSDI, Medicaid and HUD) by owning an ABLE account. You can save up to $100,000 in your ABLE account and still receive your monthly SSI benefits.
Can other people help me decide how to spend the money or set up an ABLE account?
Yes. However, it is your decision how to spend the stimulus payment. Making financial decisions is hard for many people. People you trust can help you decide what to do with your money. This includes family, caregivers and others. They might also be able to help you set up an ABLE account. It is your decision on how to spend the payment.
What can my family or representative payee or service provider, or other trusted supporter workers do to help me decide what to do with the stimulus payment?
People who help you with your money need to be sure they do not put their needs or wishes ahead of yours. That includes when they help you with decisions about the stimulus payment. They should talk with you about your options, your needs and your wishes. Some people and their supporters might choose to use something called ‘supported financial decision-making practices’. This may help them when talking about the stimulus payments and the 12-month spending timeline. Some people may choose to save some of the money for later. An ABLE account is a way to save and still protect your benefits. A good place to start is to contact your state’s ABLE plan administrator.
Are there any other payments related to COVID-19 that I should be aware of?
If you were working and lost your job, you may be able to receive unemployment benefits. The federal government is giving people who receive unemployment an extra $600 a week because of COVID-19. Unemployment benefits are counted as unearned income for SSI. You must tell Social Security if you are receiving unemployment. This could affect your SSI or SSDI benefits. You can save your unemployment benefits in an ABLE account so that they will not count as an asset in the future. Unemployment will still count as income when you receive it.
Where can I get more information about Stimulus payments?
IRS. “Economic Impact Payments.”
DC Developmental Disabilities Council
Disability Rights DC
Where can I find more information about ABLE Accounts?
National Association of State Treasurers
Where can I find more information about supported financial decision making?
Consumer Financial Protection Bureau. “Your Money, Your Goals: Focus on People with Disabilities.”
For more information about DC ABLE (the “Member Plan”), call (888) 609-3458, or visit dc.savewithable.com to obtain Plan Disclosure Documents, which include investment objectives, risks, charges, expenses, and other important information about the Member Plan. Please read and consider the Plan Disclosure Documents carefully before investing.
Investors should consider before investing whether their home state offers any state tax or other benefits that are only available for investments in such state’s qualified ABLE program.
Investors should consult their legal, tax advisor and/or other advisor regarding their specific legal, investment or tax situation.
The Member Plan is sponsored by the state of District of Columbia and administered by District of Columbia Office of the Chief Financial Officer, Office of Finance and Treasury. The Member Plan is one of the qualified ABLE plans issued by the ABLE Consortium Trust. Ascensus College Savings Recordkeeping Services, LLC, the Program Manager, and its affiliates have overall responsibility for the day-to-day operations, including investment advisory, recordkeeping and administrative services. The Member Plan offers a series of investment options within the ABLE Consortium Trust. The Member Plan is intended to operate as a qualified ABLE plan to be used only to save for Qualified Disability Expenses, pursuant to the Section 529A of the U.S. Internal Revenue Code, as amended.
Investment returns will vary depending upon the performance of the Investment Options you choose. You could lose all or a portion of y our money by investing in the Member Plan depending on market conditions. Account Owners assume all investment risks as well as responsibility for any federal and state tax consequences.
This material is provided for general and educational purposes only, and is not intended to provide legal, tax or investment advice, or for use to avoid penalties that may be imposed under federal or state tax laws. This material is not an offer to sell or a solicitation of an offer to buy any securities. Participation in the Member Plan does not guarantee that contributions and the investment return on contributions, if any, will be adequate to cover future expenses or that an account owner is eligible to participate in the Member Plan.
Investments are not FDIC-insured (except for the Checking Option). No bank, state or federal guarantee.
Investments may lose value.”