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Senate Finance advances SB302 to extend ABLE (529A) contribution tax deduction
Summary
Senate Finance voted to send SB302 to Appropriations after testimony from disability advocates and families supporting a multi‑year extension of the state deduction for ABLE 529A contributions. Witnesses said the tax incentive helps people with disabilities save for disability‑related expenses without losing means‑tested benefits.
Senate Finance advanced SB302, a bill to extend Colorado’s state tax deduction for contributions to 529A ABLE accounts (savings accounts for individuals with disabilities). Sponsors said the deduction helps people with disabilities save for disability‑related expenses without jeopardizing eligibility for Medicaid or Supplemental Security Income.
Why it matters ABLE accounts allow people with significant disabilities to hold greater savings for disability‑related costs (transportation, equipment, housing supports, education and employment supports) while preserving eligibility for means‑tested benefits. Witnesses described how the $2,000 asset limit for some benefits forces families into a cycle of poverty and said a state contribution deduction helps lower the barrier to saving.
Testimony - Elizabeth Moran, The Arc of Colorado: outlined higher poverty rates among people with disabilities and explained how ABLE accounts can promote independence and reduce family financial strain. - Carson Covey and Carson (witness spelled as “Carson Covey”): spoke about personal experience as an ABLE account beneficiary and the practical need to save for transportation and future family needs. - Jack Johnson, Disability Law Colorado: highlighted that ABLE accounts remove barriers to work and self‑determination for people with disabilities.
Action The committee voted to send SB302 to the Committee on Appropriations with a favorable recommendation.
