Frequently Asked Questions
| Question | Response |
|---|---|
| I am working and earning income – can I contribute more than the annual limit? | Yes. ABLE Account Owners who earn income may exceed the annual base limit. The additional annual contribution amount allowed is equal to the federal poverty level for a one-person household (in your state of residence) or the account owner's gross wages, whichever is less. Individuals may not be eligible if they are already contributing to their retirement through:
Account Owners should keep adequate records to ensure the limit is not exceeded. Any increase in contributions could impact tax obligations, so consult a tax advisor before making any such increase. If you are eligible, fill out the Self Certification form. |
| Question | Response |
|---|---|
| Can I designate a Successor Account Owner? | Yes. The Successor Account Owner designation must be submitted using the Account Information Change form and processed during the life of the Account Owner, even though the designation will not take effect until after the death of the Account Owner. There may only be one Successor Account Owner named on the Account. A transfer of ABLE Account assets to a Successor Account Owner, who is a non-Sibling, will be treated as a Non-Qualified Withdrawal and may generate negative tax consequences. |
| What is an Interested Party? | An Interested Party is someone designated by the Account Owner or Authorized Individual to have “read only” access to an ABLE account where they can view the account balance, investments, and similar information. However, they cannot withdraw money, change investments, or make other changes to an ABLE account. An Interested Party would be able to see how much money there is and how it is invested. Some examples of people who may be assigned this level of responsibility include a financial advisor, certified public accountant (CPA), or legal counsel, who are helping the Account Owner. |
| What happens if the account holder passes away? Where does the leftover account money go? | After the death of an Account Owner, first the funds from their ABLE account are used to pay any outstanding qualified disability expenses (QDEs)—like outstanding medical bills and funeral and burial costs. Following the payment of outstanding QDEs, the remaining account balance is paid to the Account Owner’s estate or Successor Account Owner. |
| What is an Authorized Individual? | An Authorized Individual may be designated to open and manage an account on the Account Owner’s behalf. An Authorized Individual has “full access” to the account, and they can do anything an Account Owner can do, such as withdraw money, change investments, or make other changes to an ABLE account. An Account Owner with legal capacity may designate any person or entity to act as an Authorized Individual through a power of attorney. If the Account Owner does not have legal capacity, then the permitted Authorized Individual, in order of priority, are the Account Owner’s:
More than one Authorized Individual may be appointed to an account. |
| Why are ABLE accounts important? | An ABLE account is a special type of savings account that has tax advantages and generally does not jeopardize public, means-tested benefits, such as Medicaid and SSI, if withdrawals from the account are spent on qualified disability expenses. The eligible individual with a disability is the owner of an ABLE account, but the owner can have a nAuthorized Individual, such as a parent or guardian, help with opening and managing the account. |
| How does an ABLE Account impact benefits? | SSI disregards ABLE account balances when determining benefits, except in two situations:
Medicaid disregards ABLE Account balances when determining Medical Assistance (Medicaid) eligibility. SNAP (Supplemental Nutrition Assistance Program) disregards ABLE Account balances when determining SNAP eligibility. HUD (US Department of Housing and Urban Development) for the purpose of determining eligibility and continued occupancy, HUD will disregard amounts in the ABLE Account. |
| What are the tax advantages of an ABLE Account? | The earnings on your investments are federally tax-advantaged, if used for Qualified Disability Expenses. |
| Does an Authorized Individual need to provide proof of their relationship to the Account Owner? | Depending on the ABLE plan, An Authorized Individual may need to send the corresponding documentation based on the highest applicable hierarchy chosen on the Enrollment Form for review. (i.e.-Letters of Guardianship if Guardian hierarchy chosen, Account Owner’s birth certificate if Parent hierarchy chosen-etc.). Some states only require self-certification and therefore do not require legal documentation to be submitted. For these states, the Authorized Individual self certifies through the enrollment process and/or through the use of our Add an AI form. |
| Question | Response |
|---|---|
| How often can I change my investments? | Twice per calendar year. You can change your investment options for any NEW contributions at any time. |
| What is a Systematic Exchange? | This automatically moves funds from one investment option to another. |
| What is an investment? | An asset or item purchased with the hope of a gain in the future. |
| Question | Response |
|---|---|
| What are the contribution and account balance limits I need to be aware of with an NC ABLE account? | There is an annual contribution limit of $19,000 (2025), $20,000 (2026) from all sources. Also, an employed Account Owner may be able to contribute an additional amount each year. There is a total account balance limit of $540,000. However, ABLE account balances in excess of $100,000 count toward the resource limit for SSI. |
| Can friends and family make contributions into my account? | Absolutely. Anyone can contribute directly to your account. No matter who contributes, you, the Account Owner or Authorized Individual, retain control over the account. |
| What is a recurring contribution? | These are contributions of a specific amount made automatically into your account on a custom frequency basis. For example, you can set up recurring contributions of $25 per month. This makes the process of investing very simple. |
| What is a Systematic Withdrawal? | This is a way of making automatic withdrawals, such as when you'd like to use your account to make payments each month. You can make systematic withdrawals to the bank listed on your account, by mail to your address, or to a third party. |
| What is Ugift® and how do I use it? | Ugift® is a feature of your ABLE account that allows friends and family to contribute to your savings in lieu of traditional gifts. It's simple to use - just log in to your account to find your code and share it with friends and family, who can use it atUgiftABLE.com to contribute directly into your account. |
| How can I take money out of my NC ABLE account? | There are several easy ways to withdraw money from an NC ABLE account. If you have funds in the checking account option, you can pay forqualified disability expenses using a debit card or by writing a check, or you can withdraw money at an ATM machine You can also use an Electronic Funds Transfer (EFT) to move money out of the account or contact our customer service team (888-627-7503) to have a check mailed to you. |
| How can you contribute money into an NC ABLE account? | Money can be contributed to an NC ABLE account through many methods, including:
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| Question | Response |
|---|---|
| Can I have more than one NC ABLE account? | No. You're limited to one ABLE account, except in the case of a rollover from another qualified ABLE program. This extends beyond NC ABLE to include accounts in other ABLE programs. In the case of a rollover to an ABLE account for the same account owner, the account from which the funds are withdrawn must be closed within 60 days of the withdrawal. |
| Where can I find documentation of the fees associated with NC ABLE? | All fees associated with NC ABLE can be found in the NC ABLE Plan Document. You may also refer to the NC ABLE Plan Fees Disclosure. |
| Does money in an ABLE account count as income if you are applying for Free Application for Federal Student Aid (FAFSA)? | No. ABLE accounts are NOT considered an asset of the student or their parent(s) in determining financial aid for FAFSA. |
| What is an ABLE Account? | An ABLE Account is a tax-advantaged account that people with disabilities and their families can open to save, invest, and spend their money for expenses related to living with a disability. ABLE Accounts allow individuals to build savings while preserving benefits, such as SSI, Medicaid, HUD and others, and are an alternative or add-on to a special needs trust. |
| How is an ABLE Account different than a Special Needs Trust? | ABLE Accounts differ from Special Needs Trusts in various ways. For example, ABLE Accounts have an annual contribution limit while Special Needs Trusts do not. ABLE Accounts can be managed by the Account Owner, not a trustee like Special Needs Trusts. ABLE Accounts allow for direct access to and control over one’s money as compared to a trustee overseeing a Special Needs Trust. Funds in an ABLE Account can be used to cover housing expenses without affecting SSI, if distribution and payment for housing expenses occur within the same month. If funds from a Special Needs Trust are used for housing, it could impact SSI benefits. ABLE Accounts are generally lower in cost to open and manage than a Special Needs Trust. |
| Questions | Response |
|---|---|
| Can I spend my NC ABLE account on things like food, clothing and cell phones? | Money in an ABLE account can be spent on a broad range of what are called “qualified disability expenses” or “QDEs.” QDEs are expenses that directly benefit the Account Owner in maintaining or improving health, independence, or quality of life. QDEs also include basic living expenses and are not limited to items for which there is a medical necessity. Examples of QDEs include food, housing, education, transportation, employment support, assistive technology, support services, health, and funeral and burial expenses. To the extent that a clothing or cell phone expense is a QDE, then an ABLE account withdrawal to pay for such QDE is not subject to Federal tax and does not affect eligibility for public, means-tested benefits, such as SSI and Medicaid. |
| What are qualified disability expenses (QDEs)? | The definition of “qualified disability expenses” (QDEs) is broad. QDEs are expenses that:
Examples of the types of expenses that may meet the definition of a QDE include the following:
Qualified disability expenses may include basic living expenses and are not necessarily limited to items for which there is a medical necessity. |
| Who determines what expenses are QDEs? | Qualified disability expenses (QDEs) are defined by Federal law, specifically the Federal ABLE Act and regulations from the U.S. Department of Treasury. For income tax purposes, theInternal Revenue Service (IRS) is responsible for determining whether an expense is a QDE. For Supplemental Security Income (SSI), Medicaid, and other means-tested programs, the Social Security Administration (SSA) or the agency that administers the program is responsible for QDE determinations. It is important for account owners and those assisting them to keep their receipts and maintain documentation on expenses (including tax documents provided by NC ABLE) in the event they are requested by the IRS or other government agency. The North Carolina Department of State Treasurer (NCDST) provides educational materials to account owners, parents, guardians, and others regarding QDEs. Please see What are qualified disability expenses (QDEs)? inthese FAQs and theNC ABLE Program’s website. However, theNorth Carolina Department of State Treasurer (NCDST) cannot make a legal determination or provide advice on whether a specific expense or type of expense would qualify as a QDE under Federal law. Information provided by NCDST is for educational purposes only. Please consult your legal, tax, or financial advisor for advice or additional information on QDEs. |
| I want to use money from my NC ABLE account, but I don’t know whether my purchase will be considered a QDE. Can someone help me with this? | The North Carolina Department of State Treasurer (NCDST) cannot make a legal determination or provide advice on whether a specific expense or type of expense would qualify as a QDE under Federal law. Information provided by NCDST is for educational purposes only. Please consult your legal, tax, or financial advisor for advice or additional information on QDEs. |
| Can the NC ABLE Program help me decide whether an expense is a QDE? | QDEs are defined by Federal law, specifically the Federal ABLE Act and regulations from the U.S. Department of Treasury. For income tax purposes, the Internal Revenue Service (IRS) is responsible for determining whether an expense is a QDE. For Supplemental Security Income (SSI), Medicaid, and other means-tested programs, the Social Security Administration (SSA) or the agency that administers the program is responsible for QDE determinations. It is important for account owners and those assisting them to keep their receipts and maintain documentation on expenses in the event they are requested by the IRS or other government agency. |
| What types of funeral and burial expenses are QDEs? Does it matter whether the funeral and burial expenses are prepaid versus purchased after the death of the account owner? | Funeral and burial expenses are listed in the Federal ABLE Act and related regulations as possible QDEs. The types of funeral and burial expenses are not specified or limited, and prepaid expenses are not excluded. However, as with all QDEs, funeral and burial expenses are QDEs only if they relate to the account owner’s blindness or disability and are for the benefit of maintaining or improving the account owner’s health, independence, or quality of life. |
| Question | Response |
|---|---|
| What is a representative payee? | A representative payee is a person or organization appointed by the Social Security Administration (SSA) to manage Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI) payments on behalf of an SSI/SSDI recipient (beneficiary). SSA generally appoints a representative payee if “the beneficiary is not able to manage or direct the management of benefit payments in his or her own interest.” (20 CFR § 404.2001(a), 20 CFR § 416.601(a)) However, the beneficiary does not have to be legally incompetent. (20 CFR § 404.2001(b)(2), 20 CFR § 416.601(b)(2)) In appointing a representative payee, SSA gives preference to the beneficiary’s legal guardian, spouse, or other relative if a beneficiary is at least 18 years old or the parent if the beneficiary is younger than 18. (20 CFR § 404.2021, 20 CFR § 416.621). |
| Can a representative payee open and manage an ABLE account on behalf of a beneficiary (i.e., serve as an Authorized Individual)? | Yes. A person or organization that opens and manages an NC ABLE account on behalf of an Account Owner is known as anAuthorized Individual, and the prioritized list (or hierarchy) of Authorized Individuals in the Federal ABLE regulations includes representative payees. The Authorized Individuals listed in the Federal regulations are, in order of priority:
While representative payees are prioritized lowest in the Federal regulations, often they are one of the higher priority individuals or entities as well, such as the beneficiary’s parent or guardian. In such case, the representative payee can enroll as the higher priority Authorized Individual on the list. For example, a representative payee who is also the beneficiary’s guardian could serve as the beneficiary’s Authorized Individual for an ABLE account, unless the beneficiary had a power of attorney in place. |
| Does a representative payee have to be the beneficiary’s guardian, parent, or other family member to serve as the Authorized Individual for an ABLE account? | No. However, a representative payee is the lowest priority of potential Authorized Individuals for an ABLE account. The listed Authorized Individuals in the Federal ABLE regulations are, in order of priority, agent under a power of attorney, guardian or conservator, spouse, parent, sibling, grandparent, and then representative payee. Therefore, a representative payee can serve as an Authorized Individual only if no other person or entity on the priority list is willing and able to serve. While representative payees are prioritized lowest in the Federal regulations, often they are one of the higher priority individuals or entities as well, such as the beneficiary’s parent or guardian. In such case, the representative payee can enroll as the higher priority Authorized Individual on the list. For example, a representative payee who is also the beneficiary’s guardian could serve as the beneficiary’s Authorized Individual for an ABLE account, unless the beneficiary had a power of attorney in place. |
| How does a representative payee open an NC ABLE account? | If a representative payee is authorized to open an NC ABLE account on a beneficiary’s behalf, an account can be opened online at NCABLE.org or by submitting a paper enrollment form,available here.
If a representative payee is also the beneficiary’s parent, guardian, or other person or entity on the Federal ABLE regulations’ priority list, the representative payee can enroll as the higher priority Authorized Individual on the list. The listed Authorized Individuals in the Federal ABLE regulations are, in order of priority, agent under a power of attorney, guardian or conservator, spouse, parent, sibling, grandparent, and then representative payee. |
| What is the process for SSA representative payees to be the Authorized signee on an ABLE Account? | A SSA Representative Payee will submit an Enrollment Form along with a copy of their SSA Selection notice or SSA Benefits Verification notice for review. If the named Representative Payee is an entity, and not an Individual, the representative of the entity will complete page 4 of the Enrollment Form with the entity’s name and EIN number. They will include the Authorized Entity Signatory form or a List of Authorized Signers on company letterhead naming those representatives of the agency who is designated to transact on the Entity’s behalf. Some states utilize self-certification and therefore do not require legal documentation to be submitted. For these states, the Authorized Individual self certifies through the enrollment process and/or through the use of our Account Information Change form. |
| Does the Social Security Administration have any requirements or restrictions for representative payees that may relate to ABLE accounts? | The Social Security Administration (SSA) has requirements and restrictions for representative payees, including those found in regulations, the Program Operations Manual System (POMS), and other guidance. Representative payees should be familiar with these requirements and restrictions and abide by them when serving as anAuthorized Individual on an ABLE account. Documents from SSA that may relate to ABLE accounts include the following:
The documents listed above are provided as a courtesy and are not guaranteed to be current. North Carolina and Federal law and SSA’s requirements and restrictions regarding ABLE accounts and representative payees are subject to change, and representative payees should stay updated on any changes. |
| Can a representative payee serve as a co-Authorized Individual if the beneficiary (Account Owner) already has an Authorized Individual managing the ABLE account? | No, unless the representative payee is also at the same priority level in the Federal ABLE regulations (e.g., parent, guardian) as the person currently serving as the Authorized Individual. The list of Authorized Individuals in the Federal regulations for an ABLE Account Owner who is unable to open and manage an account are, in order of priority, agent under a power of attorney, guardian or conservator, spouse, parent, sibling, grandparent, and then representative payee. |
| Can a representative payee serve as an Authorized Individual if the SSI/SSDI recipient has a guardian? | Yes. However, we recommend coordinating your account opening and management with your representative payee. The Social Security Administration (SSA) prohibits representative payees from depositing SSI/SSDI funds into an ABLE account if the representative payee is not authorized to manage the account (i.e., is an Authorized Individual). In this case, you may want to consider adding your representative payee as the Authorized Individual on your NC ABLE account. |
| What types of investments can be used by a representative payee for SSI/SSDI funds by a representative payee? | The Social Security Administration (SSA) lists U.S. savings bonds and insured, interest-bearing deposit accounts (e.g., FDIC-insured bank checking account) as preferred investments for SSI/SSDI funds that are saved (conserved). However, SSI/SSDI funds can be invested in any manner that is prudent for a trustee under state law. For example, North Carolina applies a prudent investor standard, and subject to that standard, permits a broad set of investments, including stocks and bonds. Please see the references below for more information.
SSA’s Program Operations Manual System (POMS): North Carolina law: The documents listed above are provided as a courtesy and are not guaranteed to be current. North Carolina and Federal law and SSA’s requirements and restrictions regarding ABLE accounts and representative payees are subject to change, and representative payees should stay updated on any changes. |
| What happens if a person or entity ceases to be a representative payee for an SSI/SSDI recipient who has an NC ABLE account? | If person or entity stops serving as a representative payee for an SSI/SSDI recipient who has an NC ABLE account (whether by resignation or removal), the person or entity must notify the NC ABLE Program of the change and is no longer permitted to serve as anAuthorized Individual (unless the person or entity is also one of the other Authorized Individuals in the Federal regulations). In addition to removal by the Social Security Administration (SSA), a beneficiary with legal capacity can remove a representative payee from an ABLE account.
Please note that SSI/SSDI funds are not segregated in an NC ABLE account, so the representative payee is responsible for tracking the deposit and withdrawal of SSI/SSDI funds, as well as any investment gains on SSI/SSDI funds in the ABLE account. Information on account balances, contributions, distributions, and earnings is available anytime by logging into your beneficiary’s account atNCABLE.org. See Payee and ABLE Accounts from SSA. Other SSA resources include POMS GN 00502.114 – Representative Payee Responsibilities and Duties, 20 CFR § 404.2060, 20 CFR § 416.660, and A Guide for Representative Payees. |
| Question | Response |
| If you chose to deposit your SSI payment directly into your NC ABLE account, do you have to deposit the full amount? Or can you deposit a portion of the payment? | SSI regulations requires the full amount of payment be made into one account. More information can be found on the SSI website. |
| What happens if I receive public benefits and save over the $100,000 limit in my ABLE account? | ABLE account balances in excess of $100,000 count toward the resource limit for SSI. For example, if an Account Owner has a balance of $101,000, then $1,000 in the ABLE account is counted toward the Account Owner’s resource limit for SSI. If the balance subsequently falls to $100,000 or less (e.g., through withdrawals), then no part of the ABLE account is counted toward SSI’s resource limit. Eligibility for other means-tested benefits, such as Medicaid,are not affected by the amount of money in an ABLE account. |
| Can SSI/SSDI payments be deposited in an NC ABLE account? | Yes. The NC ABLE Program accepts deposits of SSI/SSDI funds by representative payees and Account Owners (i.e., SSI/SSDI beneficiaries). However, Account Owners and representative payees are responsible for complying with any accounting requirements or investment or deposit restrictions imposed by the Social Security Administration (SSA) or Federal or state law. SSA prohibits a representative payee from depositing SSI/SSDI payments in an ABLE account if the representative payee does not have signatory authority, i.e., is not the Authorized Individual for the account. |
| Can an NC ABLE Account Owner (beneficiary) deposit SSI/SSDI payments in an NC ABLE account? | Yes |
| Does NC ABLE provide separate accounting for SSI/SSDI funds in an NC ABLE account? | No. The NC ABLE Program does not provide separate accounting or a special subaccount for SSI/SSDI funds. However, information on account balances, contributions, distributions, and earnings is available anytime by logging into your, or your beneficiary’s, account at NCABLE.org. See theSocial Security Administration’s (SSA) guidance on estimating the SSI/SSDI portion of commingled funds in POMS GN 00603.140 Social Security Benefit Funds Commingled with Other Funds Belonging to the Beneficiary. This document is provided as a courtesy and is not guaranteed to be current. North Carolina and Federal law and SSA’s requirements and restrictions regarding ABLE accounts and representative payees are subject to change, and representative payees should stay updated on any changes. Representative payees are responsible for complying with any accounting requirements or investment or deposit restrictions imposed by the Social Security Administration (SSA) or Federal or state law. |
| Can a representative payee deposit SSI/SSDI payments in an ABLE account that holds funds from other sources, such as gifts or earned income? | The Federal ABLE statute and regulations do not prohibit the deposit of SSI/SSDI payments in an ABLE account that holds funds from other sources, such as gifts or earned income, and the NC ABLE Program accepts deposits of SSI/SSDI funds by representative payees and Account Owners. The Social Security Administration recommends against commingling funds but does not prohibit it: Please note SSI/SSDI funds are not segregated in an NC ABLE account, so the representative payee is responsible for tracking the deposit and withdrawal of SSI/SSDI funds, as well as any investment gains on SSI/SSDI funds in the ABLE account. Information on account balances, contributions, distributions, and earnings is available anytime by logging into your beneficiary’s account at NCABLE.org. |
| Can an SSI/SSDI recipient (beneficiary) deposit SSI/SSDI payments in an ABLE account that holds funds from other sources, such as gifts or earned income? | The Federal ABLE statute and regulations do not prohibit the deposit of SSI/SSDI payments in an ABLE account that holds funds from other sources, such as gifts or earned income, and the NC ABLE Program accepts deposits of SSI/SSDI funds by representative payees and Account Owners. |