What are ABLE accounts and when should you use one?

An Achieving a Better Life Experience (ABLE) account lets individuals with disabilities save money without losing Supplemental Security Income (SSI) or Medicaid. Without one, even a few thousand dollars in savings can disqualify you from benefits that cover medical care, housing and daily expenses. For families in Bucks County caring for loved ones with disabilities, understanding ABLE accounts can protect both financial security and access to care.

How ABLE accounts protect benefit eligibility

SSI limits your assets to $2,000 for an individual. If you exceed that threshold, you lose monthly benefits and healthcare coverage. The federal ABLE Act expanded by the ABLE Age Adjustment Act put in effect on January 1, 2026, lets you hold up to $100,000 in an ABLE account without losing SSI eligibility.

Medicaid does not penalize you regardless of the balance. The 2026 expansion raised the age of disability onset from 26 to 46, making roughly six million more Americans eligible, including veterans and individuals with multiple sclerosis (MS), amyotrophic lateral sclerosis (ALS) or spinal cord injuries acquired later in life.

What you can use ABLE funds for

ABLE accounts cover a broad range of qualified disability expenses. The IRS defines these as costs that help you maintain health, independence or quality of life. Common uses include the following:

• Housing: Rent, utilities or home modifications for accessibility
• Healthcare: Copays, prescriptions, therapy or assistive technology
• Education and employment: Job coaching, training programs or tuition
• Transportation: Vehicle modifications, gas or public transit costs

You can withdraw funds tax-free as long as you use them for qualified expenses. Non-qualified withdrawals face income tax and a 10% penalty on earnings.

2026 contribution limits

For 2026, the annual contribution limit is $20,000. If you work and do not participate in an employer retirement plan, you can contribute an additional $15,060 under the ABLE to Work provision. One person can only have one ABLE account. If the account holder dies, Pennsylvania may file a Medicaid payback claim to recover benefits paid during the person’s lifetime, which can leave little for heirs.

Protect your loved ones in Bucks County

Many Bucks County families discover ABLE accounts too late or misuse them in ways that trigger benefit loss. An experienced special needs law attorney can help you determine whether an ABLE account fits your situation, coordinate it with a special needs trust and ensure contributions stay within legal limits. When you get it wrong, your loved one may lose the benefits that pay for their care, leaving them vulnerable at the moment they need protection most.