I 

113TH CONGRESS 

1ST SESSION H. R. 647 

To amend the Internal Revenue Code of 1986 to provide for the tax treatment 

of ABLE accounts established under State programs for the care of 

family members with disabilities, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 13, 2013 

Mr. CRENSHAW (for himself, Mr. VAN HOLLEN, Mrs. MCMORRIS RODGERS, 

Mr. SESSIONS, Mr. RUNYAN, Mr. MICA, Ms. TSONGAS, Mr. COFFMAN, 

Mr. ROE of Tennessee, Mr. COOPER, Mr. MORAN, Mr. HARPER, Mr. 

CONNOLLY, Mr. SARBANES, Ms. CLARKE, Mr. LARSEN of Washington, 

Mr. GERLACH, Mr. LARSON of Connecticut, Mr. CARSON of Indiana, Mr. 

TONKO, Mr. CICILLINE, Mr. RYAN of Ohio, Mr. YOUNG of Florida, Mr. 

HOLT, Mrs. CAPPS, Mr. BACHUS, Mr. MCGOVERN, Ms. BONAMICI, Mr. 

MATHESON, Mr. MILLER of Florida, Mr. NUNNELEE, Mr. STIVERS, Mr. 

WOMACK, Ms. HERRERA BEUTLER, Mr. JOHNSON of Ohio, Mrs. DAVIS

of California, Mr. COURTNEY, Mr. KING of New York, Mrs. HARTZLER, 

Mr. MCKINLEY, Mr. SMITH of New Jersey, Mr. VELA, Mr. WOLF, Mrs. 

CAPITO, Mr. YARMUTH, Ms. BROWNLEY of California, Mr. YODER, Mr. 

ROONEY, Mr. MARCHANT, Mrs. BROOKS of Indiana, Ms. NORTON, Mrs. 

BACHMANN, Mr. HONDA, Mr. MEEHAN, Mr. BENISHEK, Mr. POE of 

Texas, Mr. WELCH, Mr. WALBERG, and Mr. DEUTCH) introduced the following bill; which was referred to the Committee on Ways and Means, 

and in addition to the Committee on Energy and Commerce, for a period 

to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee 

concerned 

A BILL 

To amend the Internal Revenue Code of 1986 to provide 

for the tax treatment of ABLE accounts established 


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under State programs for the care of family members 

with disabilities, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Achieving a Better 

5 Life Experience Act of 2013’’ or the ‘‘ABLE Act of 

6 2013’’. 

7 SEC. 2. PURPOSES. 

8 The purposes of this Act are as follows: 

9 (1) To encourage and assist individuals and 

10 families in saving private funds for the purpose of 

11 supporting individuals with disabilities to maintain 

12 health, independence, and quality of life. 

13 (2) To provide secure funding for disability-re14 lated expenses on behalf of designated beneficiaries 

15 with disabilities that will supplement, but not sup16 plant, benefits provided through private insurance, 

17 the Medicaid program under title XIX of the Social 

18 Security Act, the supplemental security income pro19 gram under title XVI of such Act, the beneficiary’s 

20 employment, and other sources. 

21 SEC. 3. ABLE ACCOUNTS. 

22 (a) ESTABLISHMENT.— 

23 (1) IN GENERAL.—Section 529 of the Internal 

24 Revenue Code of 1986 is amended by redesignating 


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1 subsection (f) as subsection (g) and by inserting 

2 after subsection (e) the following new subsection: 

3 ‘‘(f) ABLE ACCOUNTS.— 

4 ‘‘(1) GENERAL RULES.—For purposes of any 

5 other provision of law with respect to a qualified 

6 ABLE program and an ABLE account, except as 

7 otherwise provided in this subsection— 

8 ‘‘(A) a qualified ABLE program and an 

9 ABLE account shall be treated in the same 

10 manner as a qualified tuition program and an 

11 account described in subsection (b)(1)(A)(ii), 

12 respectively, are treated, 

13 ‘‘(B) qualified disability expenses with re14 spect to a program or account described in sub15 paragraph (A) shall be treated in the same 

16 manner as qualified higher education expenses 

17 are treated, and 

18 ‘‘(C) maximum contributions shall be no 

19 higher than the limit established by the State 

20 for their regular 529 account. 

21 ‘‘(2) QUALIFIED ABLE PROGRAM.—For pur22 poses of this subsection, the term ‘qualified ABLE 

23 program’ means a program established and main24 tained by a State or agency or instrumentality there25 of— 


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1 ‘‘(A) under which a person may make con2 tributions to an ABLE account which is estab3 lished for the purpose of meeting the qualified 

4 disability expenses of the designated beneficiary 

5 of the account, 

6 ‘‘(B) which meets the requirements of the 

7 preceding subsections of this section (as modi8 fied by this subsection), determined by sub9 stituting— 

10 ‘‘(i) ‘qualified ABLE program’ for 

11 ‘qualified tuition program’, and 

12 ‘‘(ii) ‘ABLE account’ for ‘account’, 

13 and 

14 ‘‘(C) which meets the other requirements 

15 of this subsection. 

16 ‘‘(3) QUALIFIED DISABILITY EXPENSES.—For 

17 purposes of this subsection— 

18 ‘‘(A) IN GENERAL.—The term ‘qualified 

19 disability expenses’ means any expenses which 

20 are made for the benefit of an individual with 

21 a disability who is a designated beneficiary. 

22 ‘‘(B) EXPENSES INCLUDED.—The fol23 lowing expenses shall be qualified disability ex24 penses if such expenses are made for the benefit 

25 of an individual with a disability who is a desVerDate Mar 15 2010 22:24 Feb 21, 2013 Jkt 029200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H647.IH H647

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1 ignated beneficiary and are related to such dis2 ability: 

3 ‘‘(i) EDUCATION.—Expenses for edu4 cation, including tuition for preschool thru 

5 post-secondary education, which shall in6 clude higher education expenses (as de7 fined by subsection (e)(3)) and expenses 

8 for books, supplies, and educational mate9 rials related to preschool and secondary 

10 education, tutors, and special education 

11 services. 

12 ‘‘(ii) HOUSING.—Expenses for a pri13 mary residence, including rent, purchase of 

14 a primary residence or an interest in a pri15 mary residence, mortgage payments, real 

16 property taxes, and utility charges. 

17 ‘‘(iii) TRANSPORTATION.—Expenses 

18 for transportation, including the use of 

19 mass transit, the purchase or modification 

20 of vehicles, and moving expenses. 

21 ‘‘(iv) EMPLOYMENT SUPPORT.—Ex22 penses related to obtaining and maintain23 ing employment, including job-related 

24 training, assistive technology, and personal 

25 assistance supports. 


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1 ‘‘(v) HEALTH, PREVENTION, AND

2 WELLNESS.—Expenses for health and 

3 wellness, including premiums for health in4 surance, mental health, medical, vision, 

5 and dental expenses, habilitation and reha6 bilitation services, durable medical equip7 ment, therapy, respite care, long term serv8 ices and supports, nutritional management, 

9 communication services and devices, adapt10 ive equipment, assistive technology, and 

11 personal assistance. 

12 ‘‘(vi) MISCELLANEOUS EXPENSES.— 

13 Financial management and administrative 

14 services; legal fees; expenses for oversight; 

15 monitoring; home improvements, and modi16 fications, maintenance and repairs, at pri17 mary residence; or funeral and burial ex18 penses. 

19 ‘‘(vii) ASSISTIVE TECHNOLOGY AND

20 PERSONAL SUPPORT SERVICES.—Expenses 

21 for assistive technology and personal sup22 port with respect to any item described in 

23 clauses (i) through (vi). 

24 ‘‘(viii) OTHER APPROVED EX25 PENSES.—Any other expenses which are 


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1 approved by the Secretary under regula2 tions and consistent with the purposes of 

3 this section. 

4 ‘‘(C) INDIVIDUAL WITH A DISABILITY.— 

5 ‘‘(i) IN GENERAL.—Except as pro6 vided in clause (ii), an individual is an in7 dividual with a disability for a year if the 

8 individual (regardless of age)— 

9 ‘‘(I) has a medically determinable 

10 physical or mental impairment, which 

11 results in marked and severe func12 tional limitations, and which can be 

13 expected to result in death or which 

14 has lasted or can be expected to last 

15 for a continuous period of not less 

16 than 12 month, or 

17 ‘‘(II) is blind. 

18 ‘‘(ii) DISABILITY CERTIFICATION RE19 QUIRED.—An individual shall not be treat20 ed as an individual with a disability for a 

21 year unless the individual— 

22 ‘‘(I) is receiving (or, for purposes 

23 of title XIX of the Social Security 

24 Act, is deemed to be, or treated as, re25 ceiving by the State Medicaid Agency) 


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1 benefits under the supplemental secu2 rity income program under title XVI 

3 of such Act, or whose benefits under 

4 such program are suspended other 

5 than by reason of misconduct, 

6 ‘‘(II) is receiving disability bene7 fits under title II of such Act, or 

8 ‘‘(III) files a disability certifi9 cation with the Secretary for such 

10 year. 

11 ‘‘(iii) DISABILITY CERTIFICATION DE12 FINED.—The term ‘disability certification’ 

13 means, with respect to an individual, a cer14 tification to the satisfaction of the Sec15 retary by the designated beneficiary or the 

16 parent or guardian of the designated bene17 ficiary that— 

18 ‘‘(I) the individual meets the cri19 teria described in clause (i), and 

20 ‘‘(II) includes a copy of the des21 ignated beneficiary’s diagnosis, signed 

22 by a physician meeting the criteria of 

23 section 1861(r)(1) of the Social Secu24 rity Act. 


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1 ‘‘(iv) RESTRICTION ON USE OF CER2 TIFICATION.—No inference may be drawn 

3 from a disability certification for purposes 

4 of establishing eligibility for benefits under 

5 title II, XVI, or XIX of the Social Security 

6 Act. 

7 ‘‘(4) ROLLOVERS FROM ABLE ACCOUNTS.—Sub8 section (c)(3)(A) shall not apply to any amount paid 

9 or distributed from an ABLE account to the extent 

10 that the amount received is paid, not later than the 

11 60th day after the date of such payment or distribu12 tion, into— 

13 ‘‘(A) another ABLE account for the ben14 efit of— 

15 ‘‘(i) the same beneficiary, or 

16 ‘‘(ii) an individual with a disability 

17 who is a family member of the beneficiary, 

18 ‘‘(B) any trust which is described in sub19 paragraph (A) or (C) of section 1917(d)(4) of 

20 the Social Security Act and which is for the 

21 benefit of an individual described in clause (i) 

22 or (ii) of subparagraph (A), or 

23 ‘‘(C) a qualified tuition program— 

24 ‘‘(i) for the benefit of the designated 

25 beneficiary, or 


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1 ‘‘(ii) to the credit of another des2 ignated beneficiary under a qualified tui3 tion program who is a member of the fam4 ily of the designated beneficiary with re5 spect to which the distribution was made. 

6 The preceding sentence shall not apply to any pay7 ment or distribution if it applied to any prior pay8 ment or distribution during the 12-month period 

9 ending on the date of the payment or distribution. 

10 ‘‘(5) TRANSFER TO STATE.—Subject to any 

11 outstanding payments due for qualified disability ex12 penses, in the case that the designated beneficiary 

13 dies or ceases to be an individual with a disability, 

14 all amounts remaining in the qualified ABLE ac15 count not in excess of the amount equal to the total 

16 medical assistance paid for the designated bene17 ficiary after the establishment of the account, net of 

18 any premiums paid from the account or paid by or 

19 on behalf of the beneficiary to a Medicaid Buy-In 

20 program, under any State Medicaid plan established 

21 under title XIX of the Social Security Act shall be 

22 distributed to such State upon filing of a claim for 

23 payment by such State. For purposes of this para24 graph, the State shall be a creditor of an ABLE ac25 count and not a beneficiary. Subsection (c)(3) shall 


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1 not apply to a distribution under the preceding sen2 tence. 

3 ‘‘(6) REGULATIONS.—Not later than 6 months 

4 after the date of the enactment of this section, the 

5 Secretary may prescribe such regulations or other 

6 guidance as the Secretary determines necessary or 

7 appropriate to carry out the purposes of this section, 

8 including regulations to prevent fraud and abuse 

9 with respect to amounts claimed as qualified dis10 ability expenses.’’. 

11 (2) CONFORMING AMENDMENT.—Paragraph (2) 

12 of section 6693(a) of the Internal Revenue Code of 

13 1986 such Code is amended by striking ‘‘and’’ at the 

14 end of subparagraph (D), by striking the period at 

15 the end of subparagraph (E) and inserting ‘‘and’’, 

16 and by inserting after subparagraph (E) the fol17 lowing new subparagraph: 

18 ‘‘(F) section 529(d) by reason of 529(f) 

19 (relating to ABLE accounts).’’. 

20 (b) ANNUAL REPORTS.— 

21 (1) IN GENERAL.—The Secretary of the Treas22 ury shall report annually to Congress on the usage 

23 of ABLE accounts under section 529(f) of the Inter24 nal Revenue Code of 1986. 


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1 (2) CONTENTS OF REPORT.—Any report under 

2 paragraph (1) may include— 

3 (A) the number of people with an ABLE 

4 account, 

5 (B) the total amount of contributions to 

6 such accounts, 

7 (C) the total amount and nature of dis8 tributions from such accounts, 

9 (D) issues relating to the abuse of such ac10 counts, if any, and 

11 (E) the amounts repaid from such ac12 counts to State Medicaid programs established 

13 under title XIX of the Social Security Act. 

14 (c) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to taxable years beginning after 

16 the date of the enactment of this Act. 

17 SEC. 4. TREATMENT OF ABLE ACCOUNTS UNDER CERTAIN 

18 FEDERAL PROGRAMS. 

19 (a) ACCOUNT FUNDS DISREGARDED FOR PURPOSES

20 OF CERTAIN OTHER MEANS-TESTED FEDERAL PRO21 GRAMS.—Notwithstanding any other provision of Federal 

22 law that requires consideration of 1 or more financial cir23 cumstances of an individual, for the purpose of deter24 mining eligibility to receive, or the amount of, any assist25 ance or benefit authorized by such provision to be provided 


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1 to or for the benefit of such individual, any amount (in2 cluding earnings thereon) in any ABLE account (as de3 fined in section 529(f) of the Internal Revenue Code of 

4 1986) of such individual, and any distribution for qualified 

5 disability expenses (as defined in paragraph (3) of such 

6 section) shall be disregarded for such purpose with respect 

7 to any period during which such individual maintains, 

8 makes contributions to, or receives distributions from such 

9 ABLE account, except that, in the case of the supple10 mental security income program under title XVI of the 

11 Social Security Act, a distribution for housing expenses 

12 (as defined in subparagraph (B)(ii) of such paragraph) 

13 shall not be so disregarded, and in the case of such pro14 gram, only the 1st $100,000 of the amount (including 

15 such earnings) in such ABLE account shall be so dis16 regarded. 

17 (b) SUSPENSION OF SSI BENEFITS DURING PERI18 ODS OF EXCESSIVE ACCOUNT FUNDS.— 

19 (1) IN GENERAL.—The benefits of an individual 

20 under the supplemental security income program 

21 under title XVI of the Social Security Act shall not 

22 be terminated, but shall be suspended, by reason of 

23 excess resources of the individual attributable to an 

24 amount in the ABLE account (as defined in section 

25 529(f) of the Internal Revenue Code of 1986) of the 


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1 individual not disregarded under subsection (a) of 

2 this section. 

3 (2) NO IMPACT ON MEDICAID ELIGIBILITY.—An 

4 individual who would be receiving payment of such 

5 supplemental security income benefits but for the 

6 application of the previous sentence shall be treated 

7 for purposes of title XIX of the Social Security Act 

8 as if the individual continued to be receiving pay9 ment of such benefits. 

Æ 


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