An ABLE (Achieving a Better Life Experience) account is a must-have savings tool for persons with special needs. It supplements but does not replace needed public benefits while often providing greater flexibility than available under a supplemental needs trust. George Vasiliadis, an attorney with the law firm of Vasiliadis Pappas Associates,  notes that “in Pennsylvania, owners of and contributors to ABLE accounts enjoy some unique advantages not available to ABLE account owners in other states”.

The maximum amount that can be contributed each year to an ABLE account for a person with is $19,000 (2025).  That figure is tied to the inflation-adjusted value of the IRS’s gift tax annual exclusion. Pennsylvania and 45 other states offer ABLE programs.

Congress passed the Achieving a Better Life Experience (ABLE) Act in 2014, amending the Internal Revenue Code to allow families to create new tax savings plans, modeled after the popular 529 savings plans for higher education, that allow money to be set aside for or a person with special needs to pay for disability related expenses. This money can grow tax-free over time and is used to pay for qualifying expenses toward the care and support of the special needs beneficiary. These accounts offer some additional unique advantages:

  • The fund is protected against claims of creditors of both the disabled account owner and of those who contribute to the account
  • Assets in the fund and income generated from those assets do not disqualify the owner from Medicaid benefits eligibility
  • Contributors to a PA ABLE account may deduct that amount on their PA income tax return
  • Pennsylvania does not seek reimbursement after the owner’s death from ABLE accounts set up in PA or any other state for Medicaid or other public benefits paid out on behalf of the owner.

These accounts are administered by the individual states and accept contributions in the form of cash only (not bonds, securities, real estate, or other assets).  A major benefit of ABLE accounts is that the beneficiary can manage and control them once he or she comes of age.

People with disabilities who are employed can save even more beyond the $19,000 limit in an ABLE account, up to the federal poverty level for a single individual. This means that those in the lower 48 states can invest an additional $20,820 this year.

However, the total amount that can be held in an ABLE account without jeopardizing Supplemental Security Income (SSI) eligibility is $100,000. For individuals who receive Medicaid or Social Security Disability (SSDI) benefits, the maximum account limit to remain eligible for those benefits is tied to the account limit for the particular state’s 529 programs, which in 2025 in Pennsylvania is $511,758. As noted above, contributions to such an account qualify for a Pennsylvania Income Tax deduction. For more information on Pennsylvania ABLE accounts click here.

For an introduction to ABLE, click here.

For an article comparing ABLE accounts with special needs trusts, click here.

ABLE accounts are no substitute for properly drafted Supplemental Needs Trusts. But they can be a helpful supplement which enhances the well-being of incapacitated loved ones. The attorneys at Vasiliadis Pappas Associates have helped many families with special needs planning. If you have an incapacitated loved one, call us. We can help.

Contact Vasiliadis Pappas Associates for advice and assistance in implementing and administering an ABLE account for your loved one.