FAQs
Answers at your fingertips
You can scroll through the FAQs or click on a category below to scroll to that section of the page.
- About ABLE
- ALR
- Benefits
- Contributions
- Eligibility
- Fees
- General
- Gifting
- How the Account Works
- Linking Bank Accounts
- Opening an Account
- Prepaid Card
- Qualified Expenses
- Successors and Estates
- Tax Benefits
- Do I have to pay taxes on my account?
- As long as the money in your Alabama ABLE account is used for eligible expenses, it won’t be counted as income for your state or federal taxes. If a purchase doesn’t qualify as an eligible expense, you’ll have to pay income taxes and a 10% penalty on the amount. If you want to know more about the... Read more
- Will having an account make me ineligible for Medicaid?
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No. Having an ABLE account doesn’t count towards your eligibility for Medicaid regardless of the amount in the ABLE account.
- Does having an account affect my other benefits?
- You can keep your federal and state benefits (SSI, SSDI, Medicaid, SNAP, TANF, HUD Assistance, Section 8, etc.) with an ABLE account. If you receive Supplemental Security Income (SSI), there is a $100,000 limit before Social Security benefits are affected. As long as the money withdrawn is used... Read more
- What happens to my state and federal benefits?
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For Supplemental Security Income (SSI) benefits only, you can have up to $100,000 in the account before the funds start to count against the $2,000 asset limit.
Other federal and Alabama state means-tested benefits are not affected, regardless of the balance in the account.
- What type of bank accounts can I add?
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You can connect a checking or savings account.
- Are contributions considered to be an asset?
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The money in the account generally isn’t considered an asset for state and federal means-tested benefit purposes. For Supplemental Security Income (SSI) benefits only, you can have up to $100,000 in the account before the funds start to count against the $2,000 asset limit.
- Can I make direct deposits into an ABLE account?
- Users can contribute to their accounts using fast, secure direct deposits from either the Social Security Administration or their paycheck. Complete the setup process in three simple steps: Log in to your ABLE account and click on “Direct Deposit” on the Total Balance tile. Or, once logged in, go... Read more
- What happens to the account when the beneficiary turns 65?
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Nothing changes to the ABLE account when the person turns 65.
- Is there a penalty for closing an ABLE account?
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If you do not spend down the account on qualified disability expenses, you do pay a penalty at the time of closing out the account. Please see the Alabama ABLE Plan Disclosure Booklet for complete information on closing an ABLE account.
- What is the fee structure for the Alabama ABLE accounts?
- The annual Account Maintenance Fee is $35 (assessed $8.75 quarterly). There is no enrollment, investment change, transfer or distribution fee. The Investment option cost range of 0.30%-0.34% includes a .30% program management fee to cover administrative costs of overseeing, distributing and... Read more
