The only problem I have is the income level for claiming this as a deduction. The deduction for joint filers phases out at $60,000. Two working parents in an urban area easily make that limit as an AGI, though it does not mean they are moneyed by any stretch of the imagination. Lifting the AGI cap higher would help more families to be able to save that $2000 year with a tax benefit, which would be so helpful as we all struggle with bills. Still, the bill is worth supporting.
AUTISM SPEAKS APPLAUDS THE INTRODUCTION OF THE ABLE ACCOUNTS ACT - S. 493
NEW YORK, NY (February 27, 2009) -- Autism Speaks, the nation’s largest autism science and advocacy organization, today applauded Senators Robert Casey (D-PA), Orrin Hatch (R-UT), and Christopher Dodd (D-CT) for introducing S. 493, the ABLE Accounts Act of 2009, which would encourage individuals with autism and other disabilities and their families to save, tax-free, for disability-related expenses. Senators Richard Burr (R-NC), Edward Kennedy (D-MA), and Sam Brownback (R-KS) are the bill’s original co-sponsors.
The ABLE Accounts Act of 2009 – or Achieving a Better Life Experience Act – would amend the IRS code to provide for the establishment of savings accounts “for the purpose of supporting individuals with disabilities to maintain health, independence, and quality of life.” Similar in many respects to existing 529 college savings plans, these accounts will be exempt from federal taxation, provided certain rules are met. The legislation’s intent is to supplement rather than to replace benefits provided by other sources, including Medicaid and private insurance.
Accounts will have a contribution limit of $500,000 but will grow tax free and will not have any effect on the disabled individual’s ability to collect from other means tested federal programs, such as Medicaid, food stamps, and federal housing assistance. Allowable expenses include: preschool education; postsecondary education; tutoring; special education services; training; employment supports; personal assistance supports; community-based supports; respite care; clothing; assistive technology; home modifications; out-of-pocket medical, vision, or dental expenses; transportation vehicle purchases or modifications; insurance premiums; habilitation and rehabilitation services; funeral and burial expenses; and other services or products allowed by regulation.
“We commend Senators Casey, Dodd, Hatch, Brownback, Burr and Kennedy for spearheading the legislative process to create these vitally important savings accounts, which will reduce an unreasonable financial burden for millions of families and end discrimination against individuals with disabilities in the federal tax code,” said Bob Wright, co-founder of Autism Speaks. “If parents are entitled to save, tax-free, to send their child to Yale, they should be able to save in the same way to help every child meet his or her full potential.”