Saving, Benefits, and Working
There is good news. It may be possible for you to save money and be able to keep your SSI payments and waiver services. The four most common ways to save money and not lose benefits are with an ABLE account, a Special Needs Trust, an Individual Development Account, and a PASS account.
People who have acquired a disability prior to the age of 26 (New for 2026: The age limit for onset increases from 26 to 46. Read more…) and who receive or are eligible to receive SSI or SSDI may be eligible to set up an ABLE account. The monies in these accounts do not count as an asset, and therefore will not affect asset limits imposed by SSI and Home and Community-Based Services waiver programs. These funds are not taxable and can be used for assistive technology, day-to-day living expenses, transportation, medical expenses, utilities, housing expenses, as well as saving for long-term goals. You can access your ABLE account with a debit card, checks, and automatic payment transfers, just like a bank account. It’s easy to sign up at paable.gov, or call 855-529-ABLE (2253).
To compare ABLE programs among states and learn more about ABLE, visit the ABLE National Resource Center’s website at www.ablenrc.org.
When you open a PA ABLE account, you will be asked to choose an investment strategy for your money. PA ABLE offers six options for investing, and one option for a checking account with a debit card.
Investing is a way to set aside your money with the expectation that it will increase in value over time. Investments can range from high-risk to low-risk. High-risk investments come with the possibility of the greatest increase in funds but also the possibility of the greatest loss in funds. Low-risk investments are likely to only increase incrementally, but are also less likely to see a major loss.
Learn more about PA ABLE at paable.gov, or call 855-529-ABLE (2253).
To compare ABLE programs among states, visit the ABLE National Resource Center’s website at www.ablenrc.org.
A Special Needs Trust is a specially designed account that can be very helpful if you receive government benefits (like SSI, Medical Assistance, or food stamps) which limit how much you are allowed to save in your bank or credit union accounts. If the Trust is created in the right way, the money in the Trust won’t be counted against the limits the government has set up for how much money you can save. Trusts are complicated, and there are important things to know:
*New for 2024! The annual contribution limit for an ABLE account increased from $17,000 (2023) to $18,000.
Download ABLE vs. Special Needs Trusts Comparison Table (508-compliant PDF).
| ABLE Accounts | Special Needs Trusts | ||||
| First Party | Third Party | ||||
| Pooled | Individual | Pooled | Individual | ||
| Set Up By | An Eligible Individual with the legal capacity to enter into contracts may open an account for themselves or they may choose to have another person open and manage the account (“Authorized Individual”). Enrollment is available at PAABLE.gov. | Person with a disability, parent, guardian, or a court. | Anyone except the individual with the disability. | ||
| Funded By | Anyone (including self). Contributions by other people should be made directly to the ABLE account. | The individual with a disability (e.g., inheritance, lawsuit). | Anyone except the individual with the disability. | ||
| Who is Eligible? | Anyone who has a qualifying disability with an onset prior to age 26 (In 2026, the age will increase to 46). A qualifying disability is one that entitles you to Social Security disability benefits (SSI or SSDI). If not eligible for SSI or SSDI, a person may also self-certify. | Beneficiary meets Social Security Administration’s definition of “disabled” generally. There are no age restrictions for a First Party, Pooled Trust or a Third Party Pooled or Individual Trust. The First Party, Individual Trust must be set up for an individual with a disability prior to the age of 65. | |||
| Who Makes Spending Decisions? | The beneficiary (individual with a disability), guardian, and/or “Authorized Individual.” | Trustee (not the beneficiary). | |||
| Number of Accounts | One (1) per individual. | An individual may have more than one type of Special Needs Trust. | |||
| Costs | No set-up fee. The initial contribution is $25. The annual fee is $58 ($14.50 per quarter); however, if electronic delivery is selected, the annual fee is reduced to $33 ($8.25 per quarter). Additionally, there are investment fees ranging from 0.30% to 0.33%, depending on the options selected. For the checking account option (provided through Fifth Third Bank), there is a monthly service fee of $2.00, which is waived if there is e-delivery of account statements or the average monthly balance is at least $250. NOTE: These costs are accurate as of January 2024. Please go to PAABLE.gov for the most current information. | The costs vary depending on who sets up and administers the Trust(s). Some companies do not charge a fee to set up a Pooled Trust and the annual administration fee can be as low as $500 a year (for amounts under $5,000.) The set-up costs for First Party (Individual) and Third Party can be as low as $2,000 for attorney fees plus a minimum of 1% on assets ($500 minimum) for annual Trustee fees. Family members or close family friends may be willing to serve as a Trustee without charging any fees. A professional will charge an annual fee based on the account balance. (The percentage of the fee is usually higher on a smaller Trust.) | |||
| Is the Interest on the Account Taxed? | Not when in the account. Distributions for qualified expenses are tax-free. | Yes. | |||
| Deposit Restrictions | IRS Yearly Gift Limit ($18,000 in 2024). Additional contributions may be allowed for employed account owners in certain circumstances. | None. | |||
| Balance Restrictions | It’s possible to save up to $100,000 without adversely affecting eligibility for Supplemental Security Income (SSI). Above that, SSI will be suspended but not terminated. Medical Assistance (“Medicaid”) will continue. | None. | |||
| What Can the Funds Be Used For? | Funds can be used on qualified expenses, including assistive technology, housing, basic living expenses, education, transportation, and more. There are penalties if used on unqualified expenses. Funds used for housing or non-qualified expenses may impact taxes and benefits if not used within the same month they are withdrawn. (See PAABLE.gov) | Funds may be used for any expenses the Trustee deems appropriate. However, if Trust funds are spent on food and housing (shelter), this may jeopardize the beneficiary’s ability to collect Supplemental Security Income (SSI) or other government benefits and may result in the payment of penalties. | |||
| What Happens After Death? | Funds may be used for any expenses the Trustee deems appropriate. However, if Trust funds are spent on food and housing (shelter), this may jeopardize the beneficiary’s ability to collect Supplemental Security Income (SSI) or other government benefits and may result in the payment of penalties. | Medicaid payback may be avoided by permitting the trust (non-profit) to keep the assets upon the death of the beneficiary in order to help other individuals with disabilities. | The trust agreement must grant Medicaid the first right of recovery against the trust assets upon the beneficiary’s death. | The grantor can determine how the remaining trust assets are to be disbursed at the death of the beneficiary. | |
| Pennsylvania-Only Benefits | Contributions to a PA ABLE account are PA state income tax deductible up to $18,000 (2024) per person. Monies remaining in an ABLE account after the beneficiary dies are not subject to PA inheritance tax. The account is protected in state legal proceedings from the beneficiary’s creditors and the creditors of others who contributed to the account. | None. | |||
Income limits are different than asset limits. The money you set aside in an ABLE account will not affect your eligibility for any government program that imposes asset limits. However, income limits will still apply. For more information about PA ABLE, visit paable.gov.
Joy and Jill are professional musicians who care about being involved and making a difference in their community. Music, particularly Swing Era music, has always been important to them. A few years ago, they started a non-profit to promote disability awareness, offer art therapy, and preserve history through their music.
Diagnosed with limb-girdle muscular dystrophy at the age of 7, both women use a variety of assistive technology, including an adapted van to get around. It’s important to be at appointments on time, and Joy and Jill need reliable transportation to run errands, go to gigs, attend church, and take care of their aging mother.
Joy and Jill used a few different funding resources to pay for their new van. The Pennsylvania Office of Vocational Rehabilitation paid for the accessible modifications, and the sisters used a combination of monies from their ABLE accounts as well as their Special Needs Trusts to cover the cost of the van itself.
Individual Development Account (IDA) programs help people with a lower income save money for things like education, starting a business, or buying assistive technology. For every dollar a person puts into an IDA, the program will add a dollar (often more). Before you can receive this matching amount, you have to agree to the rules of the program, such as making regular contributions to the account or taking free classes on how to manage money. For more information about IDAs, or to find a program near you, you can contact Prosperity Now, or you can contact your local United Way.
For people with disabilities who plan to work, or are working, it’s possible to set up a savings account called a Plan to Achieve Self-Support (PASS) through the Social Security Administration. This will allow you to set aside monies for a specific item or service that is needed for a work goal. These monies will not be counted against your resource limit for SSI. A PASS account can make it possible for you to save the money you need for things like a down payment for a car that will help you get to a job, or for a computer that will allow you to start your own business.
Do you work or attend college? You may be able to keep your SSI and Medical Assistance benefits while working or attending college.
