Stable- individuals with disabilities accounts: broad, vague qualified expenses

momoney

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A STABLE account is an investment account available to eligible individuals living with disabilities. STABLE accounts allow you to save and invest money without losing eligibility for certain public benefits programs, like Medicaid, Supplemental Security Income (SSI), or Social Security Disability Income (SSDI). Earnings in your STABLE account are not subject to federal income tax, so long as you spend them on qualified disability expenses.

Most expenses are considered a qualified expense.

The money from your account can be used for everyday needs or unexpected events. The qualified expenses are geared toward improving health, independence, and quality of life, and include:

  • Living expenses
  • Education
  • Housing
  • Transportation
  • Employment, training, and support
  • Assistive technology
  • Personal support services
  • Health, prevention, and wellness
  • Financial management
  • Administrative services
  • Legal fees
  • Oversight and monitoring

Can I use ABLE funds to pay for a vacation?

Yes, a vacation does qualify as an eligible expense as long as it can help maintain or improve the health, independence, or quality of life of the person living with a disability.




I have a disabled adult child who has a STABLE account. We transferred 529 education funds into this account, and our child’s job also contributes to it. Although our child lives with us and covers her expenses from a separate savings account, we have never withdrawn money from the STABLE account because we didn't want to deal with the record keeping. But now that I look more into it, it seems like almost anything can be a qualified expense if you record it a certain way?

Key details about the STABLE account:
  • Maximum account balance: approximately $500,000.
  • Annual contribution limit: $18,000.
  • Additional contributions allowed if employed and not eligible for a workplace retirement plan.
  • Visa prepaid card for spending. $5 month fee
  • Utilizes Vanguard funds

Our plan has been to continue funding the account until it approaches the maximum limit and not withdraw from it. Something a guardian could help her use when we are gone.

But maybe I'm too paranoid about an audit and we should be using it now for everyday expenses? Considering the qualified expenses are so broad and vague?


Having a pet definitely improves the overall health and quality of life of our child. Qualified or Not?

 
Thanks for sharing. This is the first time I have heard of this type account. It sounds like it would be very helpful. It sound like the "rules" are not very restrictive. I don't think I'd worry too much about an audit. If you believe the expenses meet the qualifications, it should be easy to justify them - IF anyone ever asks the question. I doubt that they will but YMMV.
 
I've never heard it called a STABLE account--only an ABLE account. We had one for our son, who passed away earlier this year from his disability. There is some key language that needs to be followed. We were active in the disability community, and I've never heard of anyone getting into trouble if there was a good faith effort to adhere to key language.

You might find this site helpful:


Because my son's disability was terminal, and his expected life expectancy was much shorter than normal, we were careful to make sure he had enough funds in the ABLE account to enrich his life without having too much left over when his life ended. Medicaid has claw-back rights, and his end-of-life medical costs were astronomical.
 
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