New York starts new tax free savings accounts for the disabled
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The State Comptroller has announced that New York joins 28 other states in offering a program that will help people disabled children save money for their future.
The program is modeled on the college savings program, which is also operated by the Comptroller’s office. It allows an account to be set up in the name of any New Yorker diagnosed with a disability before the age of 26. Friends and relatives can contribute up to $14,000 a year for a total of $100,000 and the money can be used tax-free to help pay for the disabled person’s education, housing, transportation and other expenses.
State Comptroller Tom DiNapoli says the program is even more important now, with uncertainty over what President Trump and Congress may do to repeal or change the Affordable Care Act.
“There’s so much anxiety because of the uncertainty at the federal level,” DiNapoli said, “Especially for those who depend on support from the government.”
The Comptroller says he hopes the program can help allay some of those fears.
Jim Vaccaro set up a fund for his four-year-old son Matthew, who has Downs Syndrome. He says it’s a more realistic alternative than setting up a trust fund, which he says requires an upfront investment of at least $10,000, plus taxes. He says the savings account gives him “peace of mind”.
“Matthew will have more independence, greater financial security and a better quality of life,” Vaccaro said. “Something every parent wants for their child.”
The money in the savings account will not count against a person’s eligibility for supplemental security income. But the federal Medicare and Medicaid systems have not yet ruled on whether the savings account money might count against a person’s eligibility for government healthcare services.