People with disabilities can now put more money into their tax-favored Achieving a Better Life Experience accounts.
Also for the first time, people may qualify for the Saver’s Credit for low- and moderate-income workers, according to the Internal Revenue Service.
The Tax Cuts and Jobs Act, the tax reform legislation enacted in December, made major changes to the tax law for 2018 and future years.
Efforts include increasing the standard deduction, removing personal exemptions, increasing the Child Tax Credit, limiting or discontinuing certain deductions and changing tax rates and brackets.
The new law also enables eligible individuals with disabilities to put more money into their ABLE accounts and more.Credit in many cases and roll money from their 529 plans — also known as qualified tuition programs — into their ABLE accounts.
States can offer specially designed ABLE accounts to people who become disabled before age 26. Recognizing the special financial burdens faced by families raising children with disabilities, ABLE accounts are designed to enable people with disabilities and their families to save for and pay for disability-related expenses.
Though contributions are not deductible, distributions, including earnings, are tax-free to the designated beneficiary if used to pay qualified disability expenses. These expenses can include housing, education, transportation, health, prevention and wellness, employment training and support, assistive technology and personal support services and other disability-related expenses.
More information is available at irs.org