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Oregon ABLE Savings Plan
The Oregon ABLE Savings Plan is established pursuant to the ABLE Act and sections 178.300 to 178.380 of the Oregon Revised Statutes, as amended (the "Oregon Act"). The Plan is designed to be a "qualified ABLE program", which status permits a beneficiary of an ABLE account established under the plan to make tax-free withdrawals to pay for qualified disability expenses under certain circumstances.
- Program typeABLE Savings plan
- Investment ManagerSellwood Consulting
- State agencyThe Oregon 529 Savings Board
- Tax deduction
- Program ManagerSumday
- Manager contract termUNLOCK PRO
State residency requirements:Yes
Who can be a participant/owner in the program?An account may be opened by a qualified beneficiary under Section 529A or, if one is designated, his/her authorized representative on his/her behalf.
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:Annual contribution limit is currently $15,000 from all sources. If the beneficiary works, the beneficiary can also contribute part, or all, of their income to their ABLE account. This additional contribution is limited to the poverty-line amount for a one-person household. For 2018, this amount is $12,140. The designated beneficiary is not, however, eligible to make this additional contribution if their employer contributes to a workplace retirement plan on their behalf.
ABLE account beneficiaries can qualify for the Saver's Credit based on contributions they make to their ABLE accounts. Up to $2,000 of these contributions may qualify for this special credit designed to help low- and moderate-income workers.
Additional contributions to an ABLE account are not permitted if, taking into account the proposed contribution, the ABLE account's balance is or would be greater than or equal to the lifetime account limit, currently $400,000.
Minimum contributions:The minimum initial contribution amount is $25 per ABLE account. The minimum subsequent contribution amount is $10 per ABLE account.
Target-Risk Options:Select among 3 portfolio options: ABLE Conservative Investment Option, ABLE Moderate Investment Option, and ABLE Aggressive Investment Option, as well as a Cash Option.
Bank Money Market Investment / Checking Option:The Cash Option offers FDIC insurance protection for amounts contributed to the cash option
Fees & Expenses
Enrollment or application fee:None
Account maintenance fee:$45 annually
Program management fees:State Administrative Fees of 0.30%
Expenses of the underlying investments:Ranges from 0.0538% to 0.0702%, depending on the selected investment option; none for the Cash Option
Total asset-based expense ratio:0.30% - 0.3702%, depending on the selected investment option
Fees or restrictions on the number of disbursementsThere is a $2.50 fee on each paper check disbursement, as well as a $15 fee on outgoing wires, as well as for the re-issue of disbursement checks.
Taxes and other Benefits
- Tax deduction for single filers$2,375/yr
- Tax deduction for joint filers$4,750/yr
Married filing jointly residents contributing $100/month can expect an additional $0 a year in tax savings.
State tax deduction or credit for contributions:Contributions to an ABLE account with a beneficiary under the age of 21 are deductible for Oregon income tax purposes up to annual limits. The deduction is $4,865 for taxpayers filing jointly and $2,435 for single filers.
State tax recapture provisions:None
State tax treatment of qualified distributions:If a qualified withdrawal is made from an ABLE account, no portion of the distribution may be included in the gross income of the beneficiary for purposes of federal and Oregon state income taxes.
State tax treatment of rollovers:No portion of a rollover or a program-to-program transfer may be included in the gross income of the beneficiary for purposes of federal and Oregon state income taxes, or is subject to the additional 10% federal tax imposed on the earnings portion of certain non-qualified withdrawals.
Medicaid eligibilityThe 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 provisionsUnder Section 529A, following the death of the beneficiary, any state may file a claim against the ABLE account itself for the amount of the total medical assistance paid for the beneficiary under the state's Medicaid plan after the establishment of the account (or any ABLE account from which amounts were rolled to the ABLE account). The amount paid in satisfaction of such a claim is not a taxable distribution from the ABLE account. Further, the amount is to be paid to the claiming state only after the payment of all outstanding payments due for the qualified disability expenses, which include burial and funeral expenses, of the beneficiary and is to be reduced by the amount of all premiums paid by or on behalf of the beneficiary to a Medicaid Buy-In program under that state's Medicaid plan.
Is there a debit card/ purchasing card available, and if so, at what cost?Beneficiaries who wish to use a pre-paid card must pay $1.25/monthly to do so
Statutory protection of an account from creditors:UNLOCK PRO
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