On December 18, President Obama signed into law H.R. 2029, the Consolidated Appropriations Act of 2016, which – along with the Omnibus – included several provisions related to our nation's tax policy commonly referred to as the “Tax Extenders Package” or more formally known as "The Protecting Americans From Tax Hikes Act of 2015.” Within this piece of legislation were two major provisions that will have a profound effect on individuals with disabilities and their ability to more readily achieve and maintain economic self-sufficiency.
First, the legislation strengthened the Earned Income Tax Credit (EITC) by making permanent improvements of the tax credit set to expire in 2017. The EITC is one of our country’s most effective anti-poverty initiatives, keeping millions of low- to moderate-income workers out of poverty. EITC’s benefits are critical to individuals with disabilities – considering the disproportionate number of Americans with disabilities living at or below poverty, as compared to their non-disabled peers. This is a significant achievement in the fight against poverty, and puts the anti-poverty movement and the disability community in a stronger position to continue enhancing the EITC, including increasing the benefits for childless low- to moderate-income workers and lowering the age of eligibility to 21.
The second provision of particular interest to individuals with disabilities is the elimination of the state residency requirement found in the Stephen Beck Jr., Achieving a Better Life Experience (ABLE) Act. The ABLE Act, signed into law December of 2014, allows individuals with disabilities who qualify the ability to save for the future without jeopardizing eligibility for means-tested federal funded programs like Social Security and Medicaid.
Prior to enactment of H.R. 2029, a qualified ABLE beneficiary could only establish an ABLE account in their particular state of residency (provided that their state was even offering an ABLE program). By allowing ABLE beneficiaries the ability to enroll in programs outside their state, individuals will now have greater options in choosing which program best meets their needs. In addition, this could mean qualified persons may have the ability to open an ABLE account much sooner than previously anticipated. In fact, we expect the first programs to open no later than mid 2016.
Both of these provisions are very exciting and, if properly implemented, should allow individuals with disabilities an enhanced opportunity to pursue economic mobility and financial self-sufficiency. It is important to note, however, that these provisions are only as beneficial as they are utilized. As a result we strongly encourage you to share this information so that as many individuals with disabilities as possible understand and feel comfortable claiming the EITC and enrolling in ABLE programs.
If you have any questions regarding either one of these provisions, please contact Chris Rodriguez, Senior Public Policy Advisor, at crodriguezndi-inc.org.