NJ Able Account
With NJ ABLE, you can save for qualified disability expenses without losing your eligibility for certain assistance programs, like SSI and Medicaid.
Plan highlights
Save with special tax advantages.
The earnings on your investments are federally tax-deferred and tax-free, if used for qualified disability expenses.1 That can help your savings compound, earning returns on your returns.
Maintain your current benefits.
Balances of $100,000 or less are excluded from your SSI resource limit.
Only the amount OVER $100,000 is counted against your limit, along with assets held in non-ABLE accounts.
If your account causes you to exceed the SSI resource limit, then your SSI benefits will be suspended until the account balance no longer exceeds your resource limit.
2 You'll continue to be eligible for Medicaid, regardless of your account balance.
3 Open an account in minutes.
Just tell us a little bit about yourself and select your investments. That's it. You can easily access your account at any time, from a PC, tablet, or mobile device. Plus, you can get started with as little as $25.
Ways to contribute:
- Check
- Electronic Funds Transfer (EFT)
- Payroll Direct Deposit
- Recurring Contributions
Ugift
What is Ugift®?
Ugift® is an easy, free-to-use service that lets friends and family contribute directly into a loved one's ABLE plan account in lieu of traditional gifts. All gift contributions sent in via Ugift are invested into the account owner's ABLE plan account and can be used to pay for disability-related expenses. ABLE plan account owners can easily use Ugift by getting a Ugift code that can be entered by family and friends to contribute at any time on UgiftABLE.com.
Make withdrawals easily.
With NJ ABLE, you can access your savings by:
going online
calling us
mailing a paper form
debit card or check, when you contribute to the Fifth Third Bank Checking Option
Avoid hidden fees.
The annualized investment costs on assets per investment option range from 0.34% to 0.37%, depending on which investment option(s) you select. Each Account is charged an account maintenance fee of $15 each quarter. This fee can be discounted by $3.75 if you select email delivery for statements and confirmations.
Contribute more with Earned Income.
ABLE account owners who earn income may contribute additional funds beyond the annual $16,000 contribution limit. The additional annual contribution amount is equal to the federal poverty level for a one-person household (in your state of residence) or the account owner's gross wages, whichever is less. Working account owners are not eligible to contribute the additional funds if they are already contributing to their retirement through:
a defined contribution plan
an annuity contract
an eligible deferred compensation plan
Account Owners should keep adequate records to ensure the limit is not exceeded. Any increase in contributions could impact tax obligations, so consult a tax advisor before making any such increase. If you are eligible, fill out the Self Certification form.
Who's eligible?
Eligible individuals can open the account for themselves, or an authorized individual can open an account on their behalf. There are a few requirements that individuals with disabilities must meet to be able to have an account.
You're eligible if:
Your disability was present before the age of 26; and
One of the following is true:
You are eligible for SSI or SSDI because of a disability
You experience blindness as determined by the Social Security Act; OR
You have a similarly severe disability with a written diagnosis from a licensed physician that can be produced if requested.
You must self-certify that you have one of the following:
Blindness as defined by the Social Security Act (SSA); OR
A medically determinable physical or mental impairment with marked severed function limitation that has lasted, or is expected to last, at least 12 continuous months or result in death;
AND you must have a written disability-related diagnosis signed by a physician.
You must re-certify annually.
(Proof of eligibility is not required to open an account. However, you should maintain a record of your diagnosis, benefits verification letter or other relevant documents in the event that you are required to prove eligibility at a later time.)
What are Qualified Disability Expenses?
These are ANY expenses that are incurred as a result of living with a disability and are intended to improve your quality of life.
Qualified expenses include, but are not limited to:
- Education
- Health and wellness
- Housing
- Transportation
- Legal fees
- Financial management
- Employment training and support
- Assistive technology
- Personal support services
- Oversight and monitoring
- Funeral and burial expenses
When savings is used for non-qualified expenses:
The earnings portion of the withdrawal will be treated as income, so it will be taxed at your tax rate, and will be subject to a 10% federal tax penalty and applicable state taxes.
Frequently Asked Questions
Do I have to prove eligibility?
No. However, you should have a record of the doctor's signed diagnosis, a benefits verification letter from the Social Security Administration or other relevant documentation for account verification, as needed.
Do I have to prove that withdrawals are for qualified disability expenses?
Can I have more than one NJ ABLE account?
How much can I contribute to my account?
Can friends and family make contributions into my account?
How often can I change my investments?
What is a recurring contribution?
What is a Systematic Exchange?
What is a Systematic Withdrawal?
What is an investment?
I am working and earning income – can I contribute more than the $16,000 limit?
What is Ugift® and how do I use it?
- Earnings on non-qualified withdrawals may be subject to federal income tax and a 10% federal penalty tax, as well as applicable state and local income taxes.
- Please see the Plan Disclosure Documents for complete details on SSI suspension and any requirements on when you use the funds, to prevent suspension of benefits.
- Upon the death of the designated beneficiary, all amounts remaining in the qualified account not in excess of the amount equal to the total medical assistance paid for the designated beneficiary after the establishment of the account, net of any premiums paid from the account or paid by or on behalf of the beneficiary to a Medicaid Buy-In program under any state Medicaid plan established under title XIX of the Social Security Act, shall be distributed to the state that made such payments upon filing of a claim for payment by such state.
Interested in a NJ ABLE presentation for your organization? Contact DDS at 1-888-285-3036 or via email at [email protected]
Before investing in any qualified ABLE program, you should consider whether your home state offers a qualified ABLE program that provides its taxpayers with favorable state tax and other benefits that are only available through investment in the home state's qualified ABLE program. You also should consult your financial, tax, or other adviser to learn more about how state-based benefits (or any limitations) would apply to your specific circumstances. You also may wish to directly contact your home state's qualified ABLE program, or any other qualified ABLE program, to learn more about those plans' features, benefits and limitations. Keep in mind that state-based benefits should be one of many appropriately weighted factors to be considered when making an investment decision.
| Eligibility | You're eligible if: Your disability was present before the age of 26; and One of the following is true: You are eligible for SSI or SSDI because of a disability You experience blindness as determined by the Social Security Act; OR You have a similarly severe disability with a written diagnosis from a licensed physician that can be produced if requested. You must self-certify that you have one of the following: Blindness as defined by the Social Security Act (SSA); OR A medically determinable physical or mental impairment with marked severed function limitation that has lasted, or is expected to last, at least 12 continuous months or result in death; AND you must have a written disability-related diagnosis signed by a physician. You must re-certify annually. |
Last Updated: 06/24/22