Ask the Expert: Navigating a STABLE Account and How to Use It

Posted on 05/04/17 in Funding, Benefits and the Law by Amanda Buzo, Esq.

What is a STABLE Account and how do I know if I’m eligible? How can I use the money in my STABLE Account?

STABLE stands for State Treasury ABLE. It is an account for individuals with disabilities that is generally not counted as a resource when determining Medicaid or Supplemental Security Income (SSI) eligibility. Although STABLE is the name for the Ohio program established after the federal Achieving a Better Life Experience (ABLE) Act was passed, it is not limited to Ohio residents. A STABLE Account is not a trust. To open a STABLE Account, a person must qualify as an “eligible individual,” which means that the person developed his or her disability prior to the age of 26. Additionally, an eligible individual must be entitled to SSI or Social Security Disability Insurance (SSDI), have a condition listed on the Social Security Administration’s List of Compassionate Allowances, or be able to “self-certify” the disability and diagnosis. STABLE’s enrollment is only available online and offers an eligibility quiz to help individuals identify if he or she is eligible to enroll.

A STABLE Account can receive combined deposits of up to $14,000 per year from any source, including the eligible individual. The maximum amount that can be contributed over the eligible individual’s lifetime is equal to the sponsoring state’s 529 plan, which in Ohio is $426,000; however, the Account balance over $100,000 will be considered a resource if the eligible individual is also an SSI recipient.

The eligible individual has direct access to the funds in the STABLE Account and can even request a reloadable prepaid debit card. It is the responsibility of the eligible individual to use the funds correctly. STABLE Accounts should only be used for qualified disability expenses, which are expenses incurred when the person was an eligible individual, the expense relates to the disability, and the expense helps the eligible individual maintain or improve his or her health, independence, or quality of life. Examples include housing, transportation, education, assistive technology, employment training, legal fees, personal support services, health and wellness, and financial management. If an eligible individual expends funds from the STABLE Account for non-qualified disability expenses, the eligible individual will pay income tax, plus a 10% penalty, on the earnings of the non-qualified distribution. An improper distribution from a STABLE Account could also be counted as income when determining the individual’s eligibility for means-tested government benefits, like Medicaid or SSI, so understanding the rules and keeping accurate records is important.

For more information or to establish a STABLE Account, visit www.stableaccount.com or call 800-439-1653.

ABOUT THE WRITER
Amanda M. Buzo, Esq., is the Executive Director of Community Fund Management Foundation, a non-profit special needs trust advisor. Prior to joining CFMF, Amanda was a special needs and estate planning attorney.

[Opening photo: stableaccount.com]