Qualified Expenses

Money in your ABLEnow account may be used to pay for Qualified Disability Expenses. An expense is qualified if:

• You incurred the expense at a time you were considered an Eligible Individual;
• The expense relates to your blindness or disability; and
• The expense helps you maintain or improve your health, independence or quality of life.

Each person’s needs are different, and qualifying expenses may vary.

ABLEnow accounts may be used to pay a variety of expenses related to maintaining the Eligible Individual’s health, independence and quality of life. Examples of Qualified Disability Expenses include, but are not limited to:

• Education
• Housing
• Transportation
• Employment training and support
• Assistive technology and related services
• Health
• Prevention and wellness
• Financial management and administrative services
• Legal fees
• Expenses for oversight and monitoring
• Funeral and burial
• Basic living expenses
• Other expenses approved by the Secretary of the U.S. Treasury

No. Money may be withdrawn from an ABLEnow account at any time and for any reason.

It is your responsibility to track how you spend the money in your ABLEnow account.

Each year, ABLEnow reports the total amount of distributions to the Internal Revenue Service (IRS) as part of annual tax reporting. The IRS may review distributions to determine whether a withdrawal was for a Qualified Disability Expense.

In addition, ABLEnow reports to the Social Security Administration (SSA) the date and amount of each distribution. If the individual receives Supplemental Security Income (SSI) or Medicaid, the SSA may review distributions to determine whether the withdrawal was for a Qualified Disability Expense.

For this reason, you should keep records and receipts that document how funds are spent.

If money is withdrawn from an ABLEnow account for a non-qualified expense, the earnings portion of the withdrawal will be treated as income, taxed at the designated beneficiary’s tax rate, and subject to a 10% federal tax penalty.

In addition, any state tax deductions or credits previously claimed may be subject to recapture. Please check your state tax department for more information on recapture requirements.

Non-qualified withdraws may also be counted when determining eligibility for means-tested public benefits programs.