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For individuals with disabilities and their families, financial planning often involves navigating a complex web of public benefits, eligibility rules, and long-term care needs. One of the most transformative tools in this space is the ABLE account, a tax-advantaged savings vehicle designed to support disability-related expenses without jeopardizing access to critical benefits such as Supplemental Security Income (SSI) and Medicaid.
In July 2025, the passage of the One Big Beautiful Bill Act (OBBBA) marked a major milestone for the disability community. It secured the future of several key ABLE account provisions that were previously set to expire.
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.1
To qualify, the individual must have a disability that began before age 26 (changing to age 46 effective January 1, 2026). The account can be used for a wide range of expenses, including:
- Housing
- Education
- Transportation
- Healthcare
- Employment support
- 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. And like those college savings plans, ABLE account holders typically have a range of options for investing their funds.
Most states allow out-of-state residents to open ABLE accounts, and many offer debit cards for easy access and recordkeeping. (Learn more: ABLE accounts: Tax-favored savings for disability expenses)
Contribution limits and benefit protections
For 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 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. (Related: What are special needs trusts?)
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 and ABLE today.
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. (Related: “Big, beautiful” changes to review with your financial professional)
Passage of the new law made permanent several provisions that were previously temporary, ensuring long-term stability for ABLE account holders.
1. ABLE to Work. This provision allows employed individuals with disabilities to contribute beyond the standard annual limit, provided that they do not have access to a workplace retirement plan. It encourages financial independence and rewards employment.
2. 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.
3. 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 OBBBA.
Looking ahead: Planning with confidence
With the ENABLE Act now permanently embedded in federal law, ABLE accounts are more powerful than ever. Disability advocates and families should revisit their planning strategies to take full advantage of these updates.
Key takeaways to consider:
- 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 OBBBA makes permanent the ABLE to Work provision, Saver’s Credit, and 529-to-ABLE rollovers.
As the landscape of disability financial planning evolves, ABLE accounts remain a cornerstone of independence, dignity, and opportunity.
A MassMutual Special Care Planner can help guide the discussion about how these accounts can fit into an overall holistic plan to help take care of your family and loved ones.
Discover more from MassMutual …
Financial advice for special-needs families
Living with special needs: The sibling perspective
Finding family balance: Special needs vs. everybody’s needs
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