Establishing an ABLE Account in Florida

The Achieving a Better Life Experience Act (the “ABLE Act”) provides families with a valuable savings mechanism that has been underutilized since its enactment into federal law on December 19, 2014.  The ABLE Act assists individuals and families in establishing tax-free savings accounts to maintain health, independence and quality of life for individuals with disabilities. The ABLE Act provided states with a framework to enact state-specific legislation. The Florida Achieving a Better Life Experience Act (the “Florida ABLE Act”) was enacted into law on May 21, 2015. The Florida ABLE Act created Florida ABLE, Inc. (d/b/a ABLE United), which is a non-profit organization that provides support to the Florida Prepaid College Board.

To open an ABLE account in Florida (an “ABLE Account”), the Florida ABLE Act requires: (i) an applicant to be a Florida resident at the time of applying to open an ABLE account, (ii) an applicant to have a qualifying disability (“Disability”) and (iii) the Disability to have occurred prior to the applicant’s 26th birthday.  An ABLE Account must be created by an individual with a Disability who is 18 years of age or older or by someone with legal authority over the applicant, such as a parent, legal guardian or a person authorized under a power of attorney.

An individual who is eligible to open an ABLE Account (each, an “Eligible Individual” and collectively, “Eligible Individuals”) includes anyone who is eligible for ABLE Act programs under federal law. Pursuant to federal law (26 U.S.C. § 529A(e)), Eligible Individuals under the ABLE Act are individuals entitled to benefits based on blindness or disability under Title II or Title XVI of the Social Security Act, which occurred prior to the individual attaining 26 years of age. Additionally, an individual may be an Eligible Individual if the individual files a disability certification with the Secretary of the Treasury evidencing a medically determinable physical or mental impairment which results in functional limitations and the disability occurred prior to the individual attaining 26 years of age.

An individual may also qualify for an ABLE Account if the individual receives Supplemental Security Income (“SSI”) or Social Security Disability Insurance or has a condition on the List of Compassionate Allowances, which is maintained by the Social Security Administration. These conditions primarily include certain cancers, adult brain disorders and rare disorders that affect children.[1] An ABLE Account applicant may open an ABLE Account if the applicant received a diagnosis from a physician that the applicant has a medically determinable physical or mental impairment that results in marked and severe functional limitation(s) which is likely to result in death or has continued or will likely continue for one year or longer.

An ABLE Account allows an Eligible Individual to create a tax-free savings account which will not impact eligibility for SSI, Medicaid or other public benefits. ABLE Accounts fund a variety of expenses, including education, housing, medical and dental services. During a taxable year, individuals collectively may contribute up to $15,000 into an ABLE Account. Eligible Individuals who are employed may also contribute an amount equal to their current year gross income, up to $12,490 per year, to their ABLE Account in addition to the $15,000 contribution limit. The lifetime Florida ABLE Account contribution limit is $418,000. After an ABLE Account balance reaches $418,000, the account may still earn interest and income but additional contributions will be rejected. Contributions from anyone other than an Eligible Individual are considered a completed gift.  The Internal Revenue Code permits a $15,000 annual gift tax exclusion to as many people as one wishes without counting toward the grantor’s lifetime gift tax exemption of $11.7 million in 2021 (both of which are indexed for inflation). Therefore, yearly gifts of up to $15,000 to an ABLE Account are excluded from federal gift tax.

If you require assistance regarding ABLE Accounts or other planning matters, please contact Michael Salad via e-mail at or via direct dial at (954) 889-1850 or Craig Panholzer via e-mail at or via direct dial at (954) 889-1856.

Michael Salad is a partner in Cooper Levenson’s Business & Tax practice group. He concentrates his practice on estate planning, special needs planning, business transactions, mergers and acquisitions and tax matters. Michael holds an LL.M. in Estate Planning and Elder Law. Michael is licensed to practice law in New Jersey, Florida, New York, Pennsylvania, Maryland and the District of Columbia.

Craig Panholzer is an associate in Cooper Levenson’s Business & Tax practice group in its Florida office. He concentrates his practice on business transactions, cyber risk management, estate planning, special needs planning, probate and tax matters.


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