In 2015, there will be a new tax-advantaged savings plan available, for the first time, for disabled people. It will be just like 529 (which is for higher education only), contribution from after-tax money, but earnings and distributions will be tax-free, if used for a disabled person's life expenses.
Eligibility
A beneficiary has to have a disability that is present before age 26, and the definition of disability is like the one used to qualify people for Supplemental Security Income (SSI), such as autism, Down syndrome, blindness, etc.
Contribution
The maximum contribution is $14,000 per year, the same as the federal gift-tax exemption right now, and the total account cannot exceed state-based limits for 529 accounts.
Use of funds
The distribution from the account could be used for a wide variety of things, including education, housing, job training, etc.
In Summary
Just like 529, different states might see variations of the product designs. If you have such needs, keep an eye on your state's offers sometime in 2015.
Eligibility
A beneficiary has to have a disability that is present before age 26, and the definition of disability is like the one used to qualify people for Supplemental Security Income (SSI), such as autism, Down syndrome, blindness, etc.
Contribution
The maximum contribution is $14,000 per year, the same as the federal gift-tax exemption right now, and the total account cannot exceed state-based limits for 529 accounts.
Use of funds
The distribution from the account could be used for a wide variety of things, including education, housing, job training, etc.
In Summary
Just like 529, different states might see variations of the product designs. If you have such needs, keep an eye on your state's offers sometime in 2015.
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