In an article published in the April issue of Trusts & Estates, Jamie Canup discusses changes to ABLE plans in the 2017 Tax Act. “The 2017 Tax Act made some important revisions to the ABLE statute,” Canup writes. The 2017 Tax Act increased the contribution limit to ABLE accounts under certain circumstances. After the annual contribution limit is reached, a designated beneficiary may contribute additional amounts. “This provision is significant because it will permit some eligible individuals to fund their ABLE accounts with greater contributions than previously permitted, thereby allowing them to save more quickly for their future qualified disability expenses,” he explains. “In addition, earnings on greater balances in an ABLE account will grow more rapidly, which also provides for greater growth in an ABLE account.” Other significant updates include changes to saver’s credit, a nonrefundable tax credit for eligible taxpayers for qualified retirement savings contributions, and rollovers of account balances from 529 plans.
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Kristen M. Chatterton