Do you know about CalABLE accounts?

The answer to this question is usually no when I ask my conservatorship and special needs trust clients.   I then excitedly tell them about these relatively new accounts which allow an SSI/SSDI and Medi-Cal recipient to save more than $2,000 in an account and the funds can be used for qualified expenses.

Back in 2014, Congress passed the Stephen J. Beck, Jr. Achieving a Better Life Experience Act (the ABLE Act) which recognized that an individual that qualifies for SSI or SSDI or Medicaid (Medi-Cal in California) may need to have more than $2,000 in cash for expenses related to being disabled.  Each state is responsible for implementing their own ABLE accounts and California implemented its CalABLE program in 2018 under the California Treasurer.

In order to be eligible to establish a CalABLE account, the individual must have been diagnosed or able to be diagnosed with a disability by age 26.  If the beneficiary meets the age requirement and receives SSI or SSDI benefits, then they immediately qualify for a CalABLE account.  If the beneficiary meets the age requirement, but does not receive SSI or SSDI, then there are other ways to qualify.

The account can be set up online at the CalABLE website ( by the beneficiary or their Authorized Legal Representative – parent, guardian, conservator, or agent under a power of attorney.  The CalABLE website provides a list of information that is needed to have on hand when setting up the account.  I helped a client set up her own CalABLE account and it was a quick and easy process.

There are a few limitations with CalABLE accounts.  First, the annual amount that can be contributed to the account is $15,000 (in 2020).  This amount is tied to the annual gift tax exclusion, so it can change in the future.  Second, If the beneficiary is receiving SSI or SSDI, then the maximum amount that can be saved in the account is $100,000.  If the account has more than $100,000, then it will impact SSI or SSDI eligibility as well as other means-based programs.  However, so long as the account has less than $529,000, MediCal and Medicaid eligibility will not be impacted.

Third, the funds in the account can only be used for Qualified Expenses.  Qualified Expenses are basically expenses related to the beneficiary’s disability and help maintain or improve health, independence or quality of life.  This means that funds can be used for food and shelter unlike funds from a special needs trust.  There are penalties such as subjecting the funds to income tax for using funds for non-qualified expenses.

Lastly, the funds in a CalABLE account are not subject to recovery by Medi-Cal upon the beneficiary’s death.

CalABLE accounts are a great tool to provide for individuals who are receiving SSI benefits and can be helpful in conjunction with special needs trust to provide for the needs of disabled individuals.