Virginia’s ABLEnow program is celebrating its 10-year anniversary in 2026. While this is a meaningful milestone, many families still struggle with how to practically use an ABLE account.
Over the years, the rules surrounding ABLE accounts have improved and these accounts have become one of the strongest financial planning tools available for individuals with disabilities and their families.
When used correctly, ABLE accounts can help families build financial security without losing access to important government benefits like Supplemental Security Income (SSI) and Medicaid.
Why ABLE Accounts Were Created
ABLE accounts were designed to solve a major problem: individuals receiving SSI have little to no opportunities to save money. The accounts were created through the federal ABLE Act, passed by Congress in 2014. The law allowed states, including Virginia, to create tax-advantaged savings programs specifically for individuals with disabilities.
The need for these accounts was clear:
- Since 1989, the SSI asset limit has remained at just $2,000
- The cost of living, wages, and housing have all increased dramatically while the SSI asset limit has not
- Families were often forced to choose between saving for the future or keeping government benefits
ABLE accounts were created to remove that barrier.
They allow individuals to:
- Save and invest for the future
- Pay for disability-related expenses
- Maintain eligibility for SSI and Medicaid within certain limits
What ABLE Accounts Can Be Used For
Money in an ABLE account can be used for qualified disability expenses to support independence and long-term financial stability. Qualified expenses include:
- Housing
- Food
- Transportation
- Healthcare
- Education
- Assistive technology
- Other quality-of-life expenses
Why Some Families Have Been Hesitant
Even with their benefits, many families have been cautious about using ABLE accounts.
The rules can feel complicated, and families often worry that making a mistake could affect important government benefits. Many families ask, “If things are working right now, why risk changing anything?”
A major concern in the past was the Medicaid payback rule. Originally, when the account owner passed away, any remaining funds in the ABLE account would be used to repay the state for Medicaid services received. When you add up those Medicaid receipts over years, that amount could easily wipe out most of the money in the account.
However, Virginia changed this rule in 2020 to eliminate the Medicaid payback. Now families can name a remainder beneficiary and remaining funds no longer automatically go back to the state. This change made ABLE accounts far more attractive for long-term planning.
Important ABLE Account Rules
Here are some of the most important rules families should understand:
Eligibility
- Disability must have occurred before age 46
Contribution Limits
- Annual contribution limit for 2026: $20,000
- This limit includes all contributors combined
SSI Rules
- The first $100,000 in the account does not count toward SSI asset limits
- Amounts above $100,000 may suspend SSI benefits, but do not permanently terminate them
ABLE to Work Provision
- Individuals with disabilities who work may contribute more than the standard annual limit if they fit both of the following requirements:
- Individual receives earned income
- Individual does not participate in their employer retirement plan
Account Growth
- Maximum account value: $675,000 in Virginia (for individuals not receiving SSI or Medicaid benefits)
- Investments and interest grow tax-free
- Qualified withdrawals are free from income and capital gains taxes
Bottom Line: We Believe ABLE Accounts Should Be Part of a Bigger Plan
As powerful as ABLE accounts are, they are not meant to replace every other planning tool. Families often benefit most when ABLE accounts are used alongside special needs trusts. The best financial plans usually involve coordination between multiple tools, not reliance on just one solution.
About Brett
Brett Corsello is a Partner and Portfolio Manager at Juno Financial Group in Richmond, VA, where he leads the firm’s Special Needs Financial Planning Practice. He is a Chartered Financial Analyst (CFA) and a Chartered Alternative Investment Analyst (CAIA).