S. 4498: ABLE Tomorrow Act

The ABLE Tomorrow Act aims to amend the Internal Revenue Code to make existing provisions related to ABLE (Achieving a Better Life Experience) accounts permanent, enhance accessibility and awareness for families, and address various issues for individuals with disabilities. Here is a summary of key features of the bill:

1. Establishment of Permanent ABLE Features

The bill seeks to ensure that ABLE account exemptions and benefits, which currently have expiration dates, become permanent. This means people with disabilities can continue to save money in tax-advantaged ABLE accounts without worrying about losing eligibility for Medicaid or Supplemental Security Income (SSI) benefits.

2. Improved Access and Education

The bill includes provisions to:

• Encourage individuals with disabilities to use ABLE accounts by reducing barriers to entry.
• Increase awareness of ABLE programs and resources among individuals with disabilities and their families.
• Mandate governmental agencies and programs to inform potential beneficiaries about ABLE accounts, including various state and federal assistance programs and the Social Security Administration.

3. Changes to Contribution Limits

It proposes revisions to contribution limits for ABLE accounts, including:

• Removing the limitation on rolling over funds from a 529 education plan to an ABLE account.
• Implementing exceptions to contribution limits for specific lump sum payments, such as insurance proceeds.

4. Protections Against Benefit Loss

The bill aims to protect working individuals with ABLE accounts from losing essential benefits due to retirement plan rules. This includes allowing employers to make contributions on behalf of eligible individuals directly into their ABLE accounts without affecting their overall contribution limits.

5. State and Local Agency Involvement

Various agencies, including the Social Security Administration, the Department of Veterans Affairs, and housing programs, are required to provide information about ABLE accounts when individuals enroll for services. This provision aims to educate users about available savings options and resources.

6. Awareness and Educational Grant Programs

The bill establishes a grant program that permits eligible entities, such as state governments and organizations, to promote ABLE accounts. These funds can be used for activities to increase awareness, including creating materials and hosting educational events.

7. Funding Provisions

It would authorize appropriations of up to $50 million from fiscal years 2027 to 2031 to support the implementation of the bill's provisions and the grant programs.

8. Effective Dates

Provisions in the bill are intended to take effect shortly after enactment, with specific requirements for state agencies to disseminate information starting 180 days after the bill's passage.

Relevant Companies

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