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IRS Announces ABLE Account Final Regulations

IRS Announces ABLE Account Final Regulations

Achieving a Better Life Experience (ABLE) accounts now have final regulations from the Internal Revenue Service. Published last Thursday, this is the latest in a series of recently published final regulations that address changes to programs and rules affected by the 2017 Tax Cuts and Jobs Act.

What is an Achieving a Better Life Experience (ABLE) Account?

ABLE accounts were created by the 2014 ABLE Act to provide tax-advantaged savings accounts for paying expenses related to a disability. The IRS says that distributions and earnings from ABLE accounts will not be taxed when used to pay for any of the following qualified disability expenses:  

  • Housing
  • Education
  • Transportation
  • Health
  • Prevention and wellness
  • Employment training and support
  • Assistive technology and personal support services
  • Other disability-related expenses

While using money from an ABLE account to pay certain expenses is tax-free, the IRS notes that “contributions are not deductible.”

What was included in the final regulations for ABLE accounts?

The ABLE Account final regulations address comments from proposed regulations and guidance for a number of issues:

  • Recordkeeping and reporting requirements
  • Gift and generation-skipping transfer tax consequences of contributions
  • Federal income, gift, and estate tax consequences of distributions
  • Changing the designated beneficiary
  • Beneficiary eligibility for the saver’s credit
  • Rolling over funds from the designated beneficiary’s 529 qualified tuition program account

Check out the ABLE account final regulations for more information.  

Read more about ABLE accounts on IRS.gov:

Read more about recently published final regulations:

: IR-2020-227

Ryan Norton

Whether designing superheroes, penciling caricatures, or just doodling, I always knew I was going to earn some sort of art degree while in college. That was my goal before I decided to trade Edgar Degas for Edgar Allan Poe during a Freshman English class. The BA in English soon morphed into a double-major in English and Philosophy, eventually becoming an MA in English. It only makes sense that I learned of a writing opportunity for a local marketing firm while teaching a first-year college English course. Before I knew it, I was writing and editing tax-related articles for Taxing Subjects, and this has been my home since 2014.