Congress should help disabled by passing ABLE Age Adjustment Act
ABLE accounts are savings and investment tools that allow people with disabilities to save for qualified disability expenses.
Congress has the chance to deliver the gift of greater financial security to millions of Americans with disabilities by approving the ABLE Age Adjustment Act before it adjourns for 2022.
Sending this common sense measure to President Joe Biden would build on the important work of Congress in 2014 when it passed the Stephen Beck Jr. Achieving a Better Life Experience Act, often referred to as ABLE. The legislation helped people with disabilities who depend on the Social Security administration’s Supplemental Security Income to avoid chronic financial insecurity.
Before ABLE, people with more than $2,000 in assets would lose this means-tested benefit. After President Barack Obama signed the act into law, people with disabilities and their families could contribute money to an ABLE account and preserve federal benefits. ABLE accounts are savings and investment tools that allow people with disabilities to save for qualified disability expenses — assistive technology, housing, transportation, employment training, health care education, and the like — that improve health, independence and quality of life. Earnings and withdrawals are tax-free when used for qualified expenses.
But the law came with a catch: Only those whose disability began before they turned 26 are eligible to own an ABLE account, leaving millions ineligible to save. Among them: individuals who incurred spinal cord or brain injuries, or who developed severe mental illness after age 26.
The ABLE Age Adjustment Act (S. 331/H.R. 1219) would raise the age of disability onset to 46, a crucial change that will incentivize work. The age limit of 26, in fact, was only added at the 11th hour to the original bill to address opponents’ concerns about its budgetary impact. These concerns never materialized, data from the Congressional Budget Office and the Social Security Administration show. We could afford ABLE without an age cap in 2014, and we can afford ABLE with the more reasonable cap of 46 years today.
Beyond the equity issue, approving the measure will enhance the long-term affordability of ABLE programs. Currently, 46 states and Washington, D.C. administer ABLE programs that have more than 126,000 accounts with assets totaling approximately $1.1 billion. According to the National Disability Institute, about 6 million more people, including approximately 1 million veterans, will be eligible to open an ABLE account if the legislation passes.
In Illinois, we estimate an additional 250,000 would gain access to ABLE.
One of the people who would benefit is Shelley Jaspering of Ames, Iowa. At 28 — two years past the age limit — she had an accident that resulted in a permanent disability of quadriplegia. Raising the age limit would allow her to open an ABLE account. “If I could save for the future, for repairs to a van, for repairs to my house, for repairs to my wheelchair, I wouldn’t have to live in fear,” Jaspering, now 45, told the U.S. Senate Special Committee on Aging in March.
My office launched the Illinois ABLE plan in 2017, and Illinois leads the National ABLE Alliance, a bipartisan group of 17 states and D.C. that represents more than a quarter of ABLE-eligible individuals.
We continue to build on that success. Illinois recently led a successful effort to lower account fees by about 25% for current participants. Passage of the ABLE Age Adjustment Act not only will expand availability of ABLE accounts to more individuals with disabilities, it also will help support ABLE programs for all eligible individuals. More participants will lead to greater economies of scale, enhanced stability and lower costs.
I commend Sen. Robert Casey of Pennsylvania and Senate co-sponsors, including Illinois Sens. Richard Durbin and Tammy Duckworth, for their efforts to push the legislation over the finish line. I also applaud the House efforts of sponsoring Rep. Tony Cardenas of California and Illinois Reps. Danny Davis, Brad Schneider, Mike Quigley, Jan Schakowsky, Bobby Rush and Raja Krishnamoorthi.
I urge Congress to pass the ABLE Age Adjustment Act by the end of the year and ensure greater financial security for millions of Americans with disabilities. Doing so is a gift that will last a lifetime — and benefit all of us.
Michael W. Frerichs is Illinois state treasurer.
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