Virginia addresses ABLE savings trust accounts in new legislation on disability benefits

A new legislative proposal in Virginia, VA SB835, aims to enhance the financial security of individuals with disabilities by amending the rules surrounding ABLE (Achieving a Better Life Experience) savings trust accounts. Introduced on January 21, 2025, the bill seeks to protect these accounts from state recovery efforts and ensure that funds within them do not affect eligibility for state assistance programs.

The primary purpose of VA SB835 is to clarify that the Commonwealth and its agencies will not pursue payments from ABLE accounts for benefits provided to account beneficiaries, unless mandated by federal law. This provision is significant as it alleviates concerns that having savings in an ABLE account could jeopardize an individual’s access to essential state benefits.

Another key aspect of the bill allows beneficiaries to appoint a survivor for their ABLE accounts. If the beneficiary passes away, the survivor—if deemed eligible—can inherit the account. This provision aims to provide a smoother transition of financial resources for families dealing with the loss of a loved one.

The bill also stipulates that funds in ABLE accounts, including contributions and distributions for qualified disability expenses, will be disregarded when determining eligibility for state assistance. This means that individuals can save for their future without the fear of losing vital support services.

While the bill has garnered support for its protective measures, it has also sparked discussions regarding its implications for state funding and the potential for increased reliance on ABLE accounts among individuals with disabilities. Critics argue that the bill could lead to a shift in how financial resources are allocated, potentially impacting state budgets in the long term.

Experts in disability advocacy have praised the bill for its potential to empower individuals with disabilities, allowing them to save without fear of losing assistance. They argue that this could lead to greater financial independence and improved quality of life for many Virginians.

As VA SB835 moves through the legislative process, its outcomes could significantly influence the financial landscape for individuals with disabilities in Virginia. The bill represents a step toward greater inclusivity and support for a community that often faces economic challenges. The next steps will involve further discussions and potential amendments as lawmakers consider the broader implications of these changes.