In 2014, a federal law amended Section 529 of the IRS code to allow states to offer tax-free savings accounts to individuals who pay disability-related expenses. The federal Achieving a Better Life Experience (ABLE) Act is considered to be one of the most important pieces of federal legislation benefiting individuals in the disabled community since the Americans with Disabilities Act.


Louisiana’s version of the program will be launched this summer and is possible because of state legislation spearheaded by Senator Dan Claitor and Representative Franklin Foil. Louisiana families who are struggling to provide a better life for children with disabilities will now be able to invest money tax free to pay for a variety of qualified disability expenses.


Families who care for loved ones with disabilities can set up tax free savings accounts to pay for health care and other expenses. LA ABLE will also help individuals with disabilities save money in order to gain more independence, maintain their health and have a better quality of life.


LA ABLE will operate in a similar way to the state’s START program that provides a mechanism for saving for college expenses. The program will allow tax-free deposits to an ABLE account as long as funds are used on qualified expenses such as education, housing, transportation, employment training, and health and wellness. The Office of Student Financial Aid will administer the LA ABLE program, and the State Treasury will oversee program investments.


Why is a program like LA ABLE so important to the disabled community? According to statistics from the Centers for Disease Control, there are an estimated 54 million people in the United States who live with a disability. The CDC reports that health care spending for individuals with disabilities makes up more than a quarter of health care expenses nationwide.


Although health care expenses for someone with a disability can average $11,637 a year nationwide, Louisiana’s costs can range from $12,213 to $18,674 depending on the disability and the individual. When taking into account employment, medical and other costs, families caring for a loved one with a disability can spend much more than that.


LA ABLE can be critical in helping defray the impact of these costs. Families will be able to save up to $14,000 a year tax free while continuing to receive Medicaid and Social Security benefits. This can be essential for families who want to save money without worrying if dollars will be counted against them when determining eligibility for federal and state benefits programs.


Research shows that access to affordable health care and appropriate services improves the quality of life and provides positive outcomes for disabled individuals. With LA ABLE, this will be a reality for many more Louisiana families.

Sarah Mulhearn
(225) 342-0012