General InformationDownload PDF Report
The Texas Achieving a Better Life Experience (Texas ABLE) Program was established to encourage and assist individuals with disabilities and their families in saving funds to pay for many disability-related expenses critical to maintaining the individuals' health, independence, and quality of life. The Texas ABLE Program is established and maintained by the Texas Prepaid Higher Education Tuition Board with assistance from the Texas Comptroller of Public Accounts.
- Program typeABLE savings plan
- Investment ManagerAon Hewitt Investment Consulting, Inc.
- State agencyTexas Prepaid Higher Education Tuition Board with assistance from the Texas Comptroller of Public Accounts
- Tax deduction
- Program ManagerNorthStar Financial Services Group, LLC
- Manager contract termUNLOCK PRO
State residency requirements:Yes
Who can be a participant/owner in the program?An account may be opened by an eligible individual under section 529A or his/her authorized individual with legal guardianship or power of attorney.
Program restrictions:To be eligible for an ABLE savings plan, an individual must be a Texas resident, 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.
There is also a maximum account balance limit of $370,0000. However, assets can grow beyond $370,000 due to investment earnings without violating the maximum account balance limit.
Minimum contributions:Initial contribution of $50 and subsequent contribution minimum of $25.
Target-Risk Options:Select among three Managed Allocation Options: Aggressive, Moderate, and Moderately Conservative.
Bank Money Market Investment / Checking Option:The Bank Savings Account Option invests in an FDIC-insured savings account held at Bank of the West.
Fees & Expenses
Enrollment or application fee:None
Account maintenance fee:$48, $4.00 monthly
Program management fees:0.25% including 0.10% state administrative fee
Expenses of the underlying investments:0.14% to 0.40%; none for the Bank Savings Account Option
Total asset-based expense ratio:0.25% - 0.65%
Fees or restrictions on the number of disbursements$1.00 fee for each withdrawal by ACH in excess of two (2) per month
Taxes and other Benefits
- Tax deduction for single filersNone
- Tax deduction for joint filersNone
Texas doesn't offer tax deductions
Program match on contributions:None
State tax deduction or credit for contributions:N/A; Texas does not impose a state income tax on individuals.
State tax recapture provisions:N/A; Texas does not impose a state income tax on individuals.
State tax treatment of qualified distributions:N/A; Texas does not impose a state income tax on individuals.
State tax treatment of rollovers:N/A; Texas does not impose a state income tax on individuals.
Medicaid eligibilityUnder the ABLE Act, funds in a Texas ABLE account should be disregarded (i.e., treated as an excluded resource) for purposes of determining eligibility for Medicaid benefits.
Medicaid recapture provisionsUnder Section 529A, following the death of the beneficiary, any state may be required to file a claim against the beneficiary or the Texas 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 or transferred to the Texas ABLE account). The amount paid in satisfaction of such a claim is not a taxable distribution from the TEXAS ABLE account.
Is there a debit card/ purchasing card available, and if so, at what cost?No
Statutory protection of an account from creditors:UNLOCK PRO
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