AB 449 CA (2015-16 Session)
Why is this bill needed?
This bill will harmonize with recently enacted legislation, The Stephen Beck, Jr., Achieving a Better Life Experience Act of 2014 (ABLE), which allows individuals who became blind or disabled before reaching age 26 to create tax-free savings accounts.
Purpose of the bill:
According to the author, “In California many people with disabilities and their families depend on a variety of public benefits for income, health care, food and housing assistance provided by the state and federal government. There are strict eligibility requirements for public benefits, such as Supplemental Security Income/State Supplementary Payment (SSI/SSP), CalFresh and Medi-Cal, which often don’t allow an individual to have more than $2,000 in savings. To remain eligible for these public benefits, an individual cannot save for the future. AB 449 will give eligible Californians with disabilities access to federally recognized 529A ABLE accounts. The California ABLE program will be administered by the State Treasurer, who also administers 529 college savings accounts. Eligible individuals and families will be allowed to establish ABLE savings accounts that will not affect their eligibility for SSI, Medicaid and other public benefits. However, pursuant to federal law once an ABLE account reaches $100,000 SSI benefits are suspended until the balance goes below that amount. The ABLE Act recognizes the extra and significant costs of living with a disability. These include costs related to raising a child with significant disabilities or a working age adult with disabilities, for accessible housing and transportation, personal assistance services, assistive technology and health care not covered by insurance, Medicaid or Medicare. AB 449 will provide people with disabilities and families raising a child with disabilities an opportunity to save money without being penalized with loss of public social services.”
Additionally, the measure provides that any moneys in an ABLE account, contributions to, and distributions for qualified disability services from, that don’t exceed $100,000 will not count toward determining eligibility for any state or local means-tested program. Maximum contribution of $14,000 per year.
Who will be qualified?
An individual who is blind or disabled, with onset before the age of 26 can qualify. The individual must be entitled to Social Security Disability Insurance benefits, or have a disability certificate on file with the Internal Revenue Service.
Which services can the disabled person receive?
Funds may be spent on education; housing, transportation; employment training and support; assistive technology and personal support services; health, prevention, and wellness; financial management and administrative services; legal fees; oversight and monitoring; and funeral and burial services.
Who will administer this program?
Accounts will be administered by the State Treasurer
Limited Budgetary Impact
According to the Franchise Tax Board, AB 449 will result in revenue losses of $100,000 in 2015-16, $400,000 in 2016-17, and $900,000 in 2017-18.
Progress in the Legislature
Passed the Assembly on a vote of 79-0 Will be heard in the Senate starting this week. No opposition is expected
Details are available at: http://www.leginfo.ca.gov/pub/15-16/bill/asm/ab_0401-0450/ab_449_cfa_20150622_110619_sen_comm.html