General InformationDownload PDF Report
The mission of Michigan Achieving a Better Life Experience Plan is to encourage and assist the saving of private funds to help persons with disabilities cover costs that support their health, independence, and quality of life.
- Program typeABLE Savings plan
- Investment ManagerPrudential Investment Advisor
- State agencyMichigan Department of Treasury's Student Financial Services Bureau
- Tax deductionTax deduction for single filers $5,000/yrTax deduction for joint filers $10,000/yr
- Program ManagerTSA Consulting Group
- Manager contract termUNLOCK PRO
Ratings & Rankings
Our overall rating for non-residents
This is a recent program and does not yet have a 5-Cap Rating assigned.
State residency requirements:No
Who can be a participant/owner in the program?An account may be opened to save for Qualified Disability Expenses by (i) an Eligible Individual or (ii) a Designated Representative on behalf of an Eligible Individual.
Program restrictions:To be eligible for an ABLE savings plan, an individual must have been diagnosed with a disability before age 26, and be eligible to receive benefits under Supplemental Security Income (SSI) and/or Social Security Disability Insurance (SSDI). Individuals who are not receiving SSI and/or SSDI may still be eligible if they meet the age requirement and have been diagnosed by a licensed physician and received a letter of certification.
Did you know?
The plan can be used to pay for qualified disability expenses.
This can include education, job training and support, healthcare and financial management.
Savings in an ABLE account will not impact eligibility to receive government benefits.
The first $100,000 is exempt from the Supplemental Security Income limit, and beneficiaries will continue to receive Medicaid regardless of account size.
Residents are not limited to investing in their own state's ABLE plan.
Another state may offer a plan with better suited investment options, lower fees or preferred features.
Visit this plan's website to learn more
Maximum contributions:The annual contribution limit (from all sources) is equal to the annual gift tax exclusion amount under the Internal Revenue Code, currently $15,000, which is subject to change. There is also an aggregate account balance limit of $500,000. However, assets can grow beyond $500,000 due to investment earnings without violating the aggregate account balance limit.
Minimum contributions:$25 per account unless the account owner signs up for the automatic investment plan (AIP) or payroll deduction of at least $15 per payroll. The minimum subsequent contribution amount is $25, but is waived if the account owner is signed up for AIP or payroll deduction.
Target-Risk Options:Select among 5 portfolios: All Stock Aggressive, 80/20 Aggressive Portfolio, 60/40 Balanced Portfolio, 40/60 Moderate Portfolio, 20/80 Conservative Portfolio.
Bank Money Market Investment / Checking Option:An omnibus savings account insured by the FDIC and held in custody by FPS Trust Company at the Bank
Fees & Expenses
Enrollment or application fee:None
Account maintenance fee:$45 annually; $11.25 assessed quarterly
Program management fees:0.50% for all portfolios
Expenses of the underlying investments:Ranges from 0.17% to 0.28%. None for the Bank Money Market Investment Option
Total asset-based expense ratio:0.50% - 0.78%
Fees or restrictions on the number of disbursementsNo, however there is a $10 disbursement fee for checks, $15 fee for wires, and no fee for SCH.
Taxes and other Benefits
- Tax deduction for single filers$5,000/yr
- Tax deduction for joint filers$10,000/yr
Married filing jointly residents contributing $100/month can expect an additional $0 a year in tax savings.
Program match on contributions:None
State tax deduction or credit for contributions:Contributions to a plan account are deductible, in an amount not to exceed $10,000 for married taxpayers filing jointly ($5,000 for single taxpayers and for married taxpayers filing separate returns), in computing the contributor's taxable income under Michigan law.
State tax recapture provisions:None
State tax treatment of qualified distributions:The earnings portion of a non-qualified withdrawal may be subject to a partial recapture of any Michigan state income tax deduction previously claimed.
State tax treatment of rollovers:Michigan follows federal tax-free treatment.
Medicaid eligibilityThe ABLE Act is designed to ensure that the value of any and all assets purchased using funds from an ABLE account that are qualified disability expenses will not count for the purposes of determining eligibility for Medicaid, and that once an asset is purchased it will not be subject to further review. The CMS guidance can be found at Implications of the ABLE Act for State Medicaid Programs on the CMS website. Please consult with your state's Medicaid office with any additional questions.
Medicaid recapture provisionsUpon the death of the account owner or eligible individual, Code Section 529A permits a state to file a claim for the total medical assistance paid for the account owner under the state's Medicaid plan after the establishment of the account (or any ABLE account from which amounts were rolled or transferred to the account). The amount of the claim is to be paid only after the payment of all outstanding payments due for qualified disability expenses, including end of life, death and burial expenses, of the account owner and is to be reduced by the amount of all premiums paid by or on behalf of the account owner to a Medicaid Buy-In program under that state's Medicaid plan. Procedures for filing claims may vary from state to state. Designated representatives, executors, and personal representatives of estates may want to consider obtaining advice of the counsel on the applicability of, and any available exceptions to, Medicaid recapture under applicable state law and regulation.
Is there a debit card/ purchasing card available, and if so, at what cost?Yes, available summer 2017. There will be no additional fees associated with the card, except for a replacement fee if the card is lost.
Statutory protection of an account from creditors:UNLOCK PRO
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