Working Families Tax Cuts Support People With Disabilities

Working Families Tax Cuts Support People With Disabilities

Washington, D.C.-The Working Families Tax Cuts strengthen financial security and expand care options for Americans with disabilities and their families. The law permanently increases annual contribution limits for tax-advantaged savings accounts, giving individuals and families greater flexibility to prepare for future expenses. It also improves access to certain Medicaid services, making it easier for individuals with more severe disabilities to receive care in the comfort of their homes.

"Policies should reflect that individuals with disabilities have different needs," said U.S. Senate Finance Committee Chairman Mike Crapo (R-Idaho). "The Working Families Tax Cuts permanently strengthen ABLE accounts, enhance tax relief for families and caregivers and expand access to home-based care, giving more Americans the flexibility and support they need."

Key wins:

• Makes permanent the increased annual limit on contributions to Achieving a Better Life Experience (ABLE) Accounts, which offer a tax-advantaged way for disabled Americans to save for qualified expenses without losing other benefits
• Permanently allows rollovers from qualified 529 plans to ABLE accounts, giving more flexibility in financial planning
• Permanently allows disabled individuals to claim an enhanced Saver's Credit for contributions to ABLE accounts
• Expands home- and community-based services for individuals with disabilities
• Increases the Child and Dependent Care Tax Credit and the Dependent Care Assistance exclusion, offsetting costs related to caring for a disabled relative
• Permanently provides that discharging a student loan on account of total disability does not count as taxable income

What they are saying:

"The increased contribution limit strengthens ABLE as a long-term financial planning tool. Additionally, under the ABLE to Work provision, employed account owners who do not participate in an employer-sponsored retirement plan may be able to contribute significantly more… This gives working individuals with disabilities a meaningful opportunity to build savings for housing, retirement and future needs without risking their benefits." - National ABLE Resource Center Director Jody Ellis

Click HERE to learn more about the Finance Committee provisions in the Working Families Tax Cuts.