529 PLANS

ABLE New Mexico

New Mexico

The State of New Mexico has partnered with the State of Ohio to create ABLE New Mexico, a program that offers the STABLE Account Plan to eligible New Mexico residents. The STABLE Account Plan is established pursuant to Ohio law (Ohio Revised Code §113.50-§113.56) in accordance with Section 529A, and is structured and operated by the Ohio Treasurer's Office and its Service Providers.

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General

Program type:

ABLE Savings plan

How to enroll:

Enroll directly with the program.

Initial year of operation:

2018

State agency(ies):

Office of New Mexico State Treasurer

Program manager:

Intuition ABLE Solutions, LLC

Manager contract term:

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Investment Manager

Marquette Associates is the Investment Advisor, and The Vanguard Group and Fifth Third Bank are the providers of the investment options.

Eligibility

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 by an authorized legal 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.

Contributions

Maximum contributions:

The plan's annual contribution limit is currently $15,000 per year per beneficiary from all sources. If employed, up to $27,060 per year.There is also a lifetime account limit of $462,000, at which point no new contributions may be made.

Minimum contributions:

The minimum initial contribution amount is $50.00 per Account. The minimum subsequent contribution amount is $1.00 per Account.

Investment Options

Target-Risk Options:

Select among four Investment Options: Income, Conservative Growth, Moderate Growth, Growth.

Bank Money Market Investment / Checking Option:

The BankSafe Option offers FDIC insurance protection for amounts invested in the option, up to FDIC-permitted limits. The option allocates 100% of its assets to Fifth Third Bank's BankSafe Product.

Fees & Expenses

Enrollment or application fee:

There is no application fee for online enrollments, but a fee of $50 will be assessed to all paper applications.

Account maintenance fee:

$42, $3.50 monthly per STABLE account

Program management fees:

State administrative fee of 0.19%

Expenses of the underlying investments:

Ranges from 0.12% to 0.15%, none for the BankSafe option

Total asset-based expense ratio:

0.19% - 0.34%, depending on the selected investment option.

Fees or restrictions on the number of disbursements

None

Taxes and other Benefits

Program match on contributions:

None

State tax deduction or credit for contributions:

Contributions to the Plan are not deductible for New Mexico state income tax purposes. However, contributions to the Plan that are considered non-taxable "gifts" for federal income tax purposes are subject to the same treatment for New Mexico state income tax purposes. Earnings grow tax-deferred from New Mexico state income tax. Earnings are not subject to New Mexico state income tax while they remain in a STABLE Account.

State tax recapture provisions:

N/A

State tax treatment of qualified distributions:

There is no New Mexico state income tax on qualified withdrawals, to the extent such transactions are exempt from U.S. federal income taxation under Section 529A.

State tax treatment of rollovers:

New Mexico follows federal income tax laws with respect to Distributions, Rollovers, and Program-to-Program Transfers.

Medicaid eligibility

Under the ABLE Act, funds in a STABLE Account should be disregarded (i.e., treated as an excluded resource) for purposes of determining eligibility for Medicaid benefits. Additionally, suspension of SSI benefits due to a STABLE Account balance of over $100,000 (see above) will have no effect on Medicaid eligibility. A STABLE Account will not affect eligibility for state-based means-tested benefits programs offered by New Mexico.

Medicaid recapture provisions

Under Section 529A, following the death of the beneficiary, any state may file a claim against the beneficiary or the STABLE 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 STABLE Account (or any ABLE account from which amounts were rolled or transferred to the current STABLE Account). The amount paid in satisfaction of such a claim is not a taxable distribution from the STABLE Account.

Is there a debit card/ purchasing card available, and if so, at what cost?

Beneficiaries can transfer funds from STABLE Account onto the STABLE Card and use the card to pay for qualified disability expenses.

Statutory protection of an account from creditors:

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Distributions & Terminations

To whom are distributions made payable:

Only the beneficiary, or, if one has been named, the authorized legal representative may direct withdrawals from a STABLE Account.

Account Changes

Policy regarding participant/owner changes:

A change in the beneficiary of a STABLE Account is not treated as a distribution and is not subject to federal gift or GST taxes if the new beneficiary is an eligible individual and a sibling of the current beneficiary. However, if the new beneficiary is not a sibling of the current beneficiary, the change is treated as a non-qualified withdrawal by the current beneficiary and may have federal gift tax or GST tax consequences.

Documents, Access & Reporting

Does participant have online password-protected access to account?

Yes

Can the complete enrollment process including funding be done online?

Yes

Documents and other services accessible or downloadable on the program's public Web site:

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Contact

Website:

http://ablenewmexico.com/

Telephone:

800-439-1653

Email:

team@stableaccount.com

State News

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