TRENTON, NJ — Individuals with disabilities can now save tax-free for eligible expenses, such as education, housing and transportation, without losing eligibility for Medicaid and other benefits.
N.J. Department of Human Services recently launched NJ ABLE (Achieving a Better Life Experience), which enables participants to establish tax-free accounts that will not be included as an asset or income when determining an individual’s eligibility for state assistance programs.
The earnings on NJ ABLE investments are federally tax-deferred and tax-free, if used for qualified disability expenses. This can help savings compound. The program also offers a range of investment options.
“This is an exciting new program for New Jersey that gives individuals with disabilities and their families the opportunity to improve their financial security,” Johnson said. “They deserve the peace of mind that comes with being able to save for vital day-to-day expenses. Individuals with disabilities can do anything — and NJ ABLE is now another tool to help them live full and independent lives,” Human Services Commissioner Carole Johnson said in a press release.
These accounts can be used to pay for expenses incurred as a result of living with a disability. Qualified expenses include, but are not limited to, education, health and wellness, housing, transportation, legal fees, financial management, job training and support, assistive technology and personal support services.
The program’s launch was welcomed by advocacy groups throughout the state, including The Arc of New Jersey.
“With the launch of the New Jersey ABLE accounts, residents with intellectual and developmental disabilities will have now have access to a very important savings tool,” said Thomas Baffuto, Arc executive director. “These accounts will allow individuals to work more, to save more and to plan more. The tax-advantaged savings accounts will give individuals with I/DD more freedom to live an integrated life, achieve their goals and to afford education, housing, transportation and other expenses that may be hard to pay for while also maintaining eligibility for critically important federal programs and benefits."
For more information, visit the program’s website by clicking here.
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