---
date: "2026-05-17"
speaker: "Tom Treacy"
organization: "Deputy Assistant State Treasurer, Kansas State Treasurer's Office"
topic: "Kansas 529 ABLE Savings Accounts"
blurb: "Tom Treacy walked us through the history, eligibility, mechanics, and tax advantages of Kansas 529 ABLE accounts — a tax-advantaged savings vehicle that lets individuals with disabilities save and invest without losing SSI or Medicaid eligibility."
---

# Tom Treacy - Kansas 529 ABLE Savings Accounts

**Date:** 2026-05-17
**Organization:** Deputy Assistant State Treasurer, Kansas State Treasurer's Office

> Tom Treacy walked us through the history, eligibility, mechanics, and tax advantages of Kansas 529 ABLE accounts — a tax-advantaged savings vehicle that lets individuals with disabilities save and invest without losing SSI or Medicaid eligibility.

## Notes from May 17th — Tom Treacy — Kansas 529 ABLE Savings Accounts

***Disclaimer:*** *These are my personal notes from our FWM meeting — not material reviewed or provided by the speaker. Any errors are mine alone. They are shared for informational purposes only and are not tax, legal, financial, or investment advice. Rules and individual situations vary, so please consult a qualified professional before acting on anything here. Tom Treacy's office is a great starting point, but not a substitute for advice tailored to your family.*

### Take Action Now

- **Open a Kansas ABLE account:** [ks.savewithable.com enrollment](https://ks.savewithable.com/ksabletpl/uii529enroll/gettingStarted.do)
- **Required documents to open an account** (shows how a Grandparent, Sibling, Parent, Legal Guardian, or Conservator opens an account for the beneficiary): [Kansas State Treasurer — ABLE Savings Account](https://www.kansasstatetreasurer.ks.gov/able_savings_account.html)
- **Missed our meeting?** Register for a virtual ABLE informational class: [ABLE Zoom Registration Links — May 2026](https://www.kansasstatetreasurer.ks.gov/assets/Files/ABLE_Zoom_Registration_Links_May26.pdf)
- **$100 Kansas ABLE Empowerment Grant** — three steps: (1) submit your name at [KansasCash.ks.gov/grant](https://www.kansascash.ks.gov/grant), (2) attend an in-person or virtual class (this meeting counts), (3) open a Kansas ABLE account by **July 1, 2026**. Grants are paid on the 15th of the month after you complete the steps.

### History of the ABLE Program

- ABLE was "a bill for the disability community by the disability community." It began at the kitchen table of **Stephen Beck Jr.** in Virginia, planning the financial future of his two daughters — Mariae Rose and Natalie (who has Down syndrome). He learned Natalie couldn't have more than **$2,000 in countable assets** and still keep Medicaid and other disability benefits — a number unchanged since the early 1980s.
- He modeled it after college savings accounts and drafted the [ABLE Act (IRC §529A)](https://www.congress.gov/bill/113th-congress/house-bill/647). The bill was championed by Senators **Robert Casey Jr.** (D-PA) and **Richard Burr** (R-NC) and Representatives **Crenshaw** (R-FL), **Cathy McMorris Rodgers** (R-WA), **Chris Van Hollen** (D-MD), and **Pete Sessions** (R-TX).
- **Sara Wolff** wrote a change.org petition in February 2014 that gathered 260,000+ signatures and was the catalyst for national momentum. She testified before the Senate Finance Subcommittee on July 23, 2014.
- The House passed the ABLE Act **404–17** on December 3, 2014; the Senate passed it as part of the Tax Extenders Package on December 17. President Obama signed it into law on **December 19, 2014.** It was the first piece of legislation affecting people with disabilities to pass Congress in 25+ years.
- The federal law only *permitted* states to build their own programs (like 529 college plans).
- In Kansas: **Jawanda Mast** and her daughter **Rachel** teamed up with Kansas State Representative **Erin Davis** to push for state legislation. They worked with then–State Treasurer Ron Estes' office on HB 2216, which was introduced January 22, 2015 and moved quickly — passing the Senate on March 25 and the House on April 1. Governor Brownback signed the Kansas ABLE Act on **April 15, 2015**.
- **Rachel Mast opened the first Kansas ABLE account on January 26, 2017.**
- Kansas joined the [National ABLE Alliance](https://savewithable.com/) — initially Kansas plus 8 other states; as of 2026-05-20 the policy alignment extends across 19 states — to pool assets and lower fees.

### What is an ABLE Account?

- A **§529A tax-advantaged savings account**
- Contributions: after-tax. Growth: tax-deferred. Qualified withdrawals: tax-free. (Similar to a Roth IRA)
- **The beneficiary owns the account.** This is one of the biggest differences from a special needs trust (most SNTs are 3rd-party — the trust owns the assets, not the beneficiary).
- **Authorized Individuals** (parents, guardians, POAs, conservators) can be added to help manage the account.

### A Quick Note on SSI, SSDI, and OASI

These three acronyms come up a lot in the disability-benefits world — they sound similar but they're very different programs. Two of them (SSDI and OASI) are funded by FICA payroll taxes and together make up what most people call "Social Security." SSI is a separate, needs-based program funded out of general tax revenue.

- **SSI (Supplemental Security Income)** — needs-based assistance for disabled or elderly people who haven't paid into Social Security. **This is the one with the $2,000 countable-asset cap.** Funded out of general tax revenue, not FICA.
- **SSDI (Social Security Disability Insurance)** — work-history-based: pays out to workers who became disabled after paying enough FICA taxes through their jobs. **SSDI has no asset cap.** Part of Title II of the Social Security Act (the "DI" in OASDI).
- **OASI (Old-Age and Survivors Insurance)** — the *other* part of Title II: retirement, spousal, and survivor benefits paid on a worker's earnings record. Also funded by FICA. SSDI + OASI together = **OASDI**, what most people just call "Social Security." OASI has no asset cap.
- **The DAC (Disabled Adult Child) bridge.** This is the one that matters for our families. A child with a qualifying disability that began before age 22 can collect benefits on a parent's Social Security record once the parent retires, dies, or becomes disabled. When a parent retires or passes, the benefit usually shows up labeled "SSDI" but is drawn from the parent's OASI (retirement/survivors) record.
- **What our kids typically receive at 18** is **SSI** (they haven't worked, so they haven't paid into Social Security on their own). When a parent retires or dies, the child often switches over to **DAC benefits** on the parent's record — usually a higher monthly amount than SSI.
- **Why this matters for ABLE.** ABLE was created specifically to work around SSI's $2,000 asset cap (and Medicaid's). If your child receives only SSDI or DAC benefits, an ABLE account is much less critical for asset-protection purposes — neither program has an asset limit. ABLE only matters for SSDI/DAC recipients if they *also* receive Medicaid (which does have its own asset limits).

### Eligibility (Two Tests)

1. **Age of onset:** Symptoms of the qualifying disability must have first appeared **before age 46**. *(As of January 2026, the ABLE Age Adjustment Act raised this from 26 to 46.)* You can open an account at any current age. Example: a 47-year-old who developed a Parkinson's tremor at age 38 — even though it wasn't disabling at 38 — is eligible.
2. **Severity:** Either the beneficiary is *eligible* (doesn't have to be receiving) for **SSI or SSDI**, OR a doctor's diagnosis is on file with Treasury. A GP note works — does not have to be a specialist.

**Cross-state notes:**

- A Kansas account can have a beneficiary in another state.
- Kansas is a **"tax parity" state** — KS residents can deduct contributions to *any* state's ABLE plan. IA and others require you to use their own state plan to get the state tax deduction.
- Nearly all states have an ABLE plan now; 19 of them share the National ABLE Alliance investment platform. (as of 2026-05-20)

### Medicaid Payback / Clawback Provision

- **Federal default:** at the beneficiary's death, the state can recoup paid Medicaid costs from the ABLE balance. This is the biggest *disadvantage* vs. a Special Needs Trust (SNTs have no clawback — remainder goes to heirs).
- **Kansas (2018 law):** clawback **only happens if the beneficiary passes after age 55**. Before 55, no payback.
- **Federal legislation is pending** that would eliminate the clawback nationally.

### Means-Tested Benefits & ABLE

- The **$2,000 countable-asset cap** still applies to traditional bank accounts — for Medicaid AND for Social Security (SSI).
- **ABLE doesn't count against the cap for SSI up to $100,000.** Above $100K, SSI is suspended; only the *excess* is counted (so $102K means $2K counted — a small grace).
- **For Medicaid: unlimited.** You can have half a million in an ABLE account and still keep Medicaid. You'd just sacrifice the SSI monthly check (~$994).

### Spending: Qualified Disability Expenses (QDEs)

If you can make the case that it adds to your child's well-being or enhances their life, it's a qualified expense.

Qualified categories (slide 6): housing, transportation, education, job coaching, assistive technology, disability supports, health & wellness, basic living expenses, financial management, legal fees, ABLE account oversight.

- **Vacation:** Vacation costs tied to the beneficiary's care can qualify; for example, paying a non-family caregiver to travel with the family.
- **Conferences tied to the child's needs** (e.g., [Autism Law Summit](https://autismlawsummit.com/)) are qualified for the parent traveling with the child.
- **Not qualified:** cigarettes, gambling, anything that takes away from the beneficiary's health, or expenses not tied to the beneficiary.

**Spending strategy:**

- **Two-account model.** Keep a local bank account below $2,000; keep most savings in ABLE.
- **Don't nickel-and-dime ABLE.** Use it for **recurring bills** (cell phone, insurance, rent) and **big-ticket items** (vehicles, dental). Buying a $7 Subway sandwich on the ABLE debit card means keeping a receipt — not worth it for an IRS audit.
- Roll leftover SSI money into ABLE at month-end. SSI can direct-deposit into ABLE, though many families prefer to consolidate routine spending elsewhere.
- **Property/vehicle bought with ABLE never counts as an asset** for benefits purposes. Cash from liquidating a gifted house/land *would* count — that's where a Special Needs Trust matters.

### Contribution Limits

- **$20,000/year aggregate** from anyone and everyone combined. Recently decoupled from the federal gift-tax limit (so the numbers may diverge going forward; ABLE was previously $19,000 last year, $20,000 this year).
- **$550,000 lifetime cap** in Kansas — tied to the cost of five years at the most expensive Kansas/Midwest higher-education programs. At the cap you can't contribute, but the account can keep growing.
- **ABLE to Work:** an employed beneficiary can add up to an **additional $15,650** of earned income on top of the $20K — total theoretical max ~$35,000/year. Cap is tied to the federal poverty line and updates annually.
- **Payroll deduction** is available; usually only worth setting up when you're not making disbursements yet (e.g., parents of young children).

### Tax Advantages

- **Federal:** tax-free growth on earnings; tax-free qualified withdrawals.
- **Kansas state income tax deduction:** up to **$3,000 per individual / $6,000 married filing jointly** per year. (Deduction, not credit — at ~5.2% KS marginal rate that's roughly $156/$312 of actual savings.)
- **No prior approval needed** to spend. You don't have to submit receipts unless the IRS audits you.
- **Non-qualified withdrawals:** tax on the **earnings only** (not principal) **+ 10% federal penalty on earnings only**.

### ABLE vs. Special Needs Trust (SNT)

A frequently misunderstood comparison:

| | ABLE | Third-Party SNT |
|---|---|---|
| Owner | Beneficiary | Trust |
| Contribution cap | $20K/yr; $550K lifetime | Unlimited — can deposit millions |
| Growth taxation | Tax-free | Taxed at trust tax rates when distributed — consult a tax advisor (currently trust rates are ~37%) |
| Medicaid clawback | Yes (KS: only after age 55) | None — remainder goes to heirs |
| Spending rules | None — beneficiary controls | Legally enforceable per trust document |
| Room & board | OK | May affect SSI; consult an attorney |

**Use them together:** An SNT can fund an ABLE account up to the annual contribution limit. Talk to an estate attorney about how to structure this so the trust language tracks future limit increases. Once funds are in ABLE for 5+ years, earnings come out tax-free.

### Account Features

- **Checking option (FDIC-insured via Fifth Third Bank).** Debit card, unlimited check writing, no overdraft fees, up to $250,000 FDIC coverage. Interest is 0.01%. $2/mo fee waived with $250 average balance OR paperless statements. Fifth Third has no Kansas branches, so for KS residents this is all phone/online — another reason to keep a local bank account.
- **7 investment options** — aggressive → very conservative + a money market option. You can split contributions across options (e.g., 60% investment / 40% checking).
- **Only 2 reallocations per calendar year** between investment options (same as 529 rules).

### 529 ↔ ABLE Strategy

Please contact your financial advisor to discuss the investment benefits of growing savings in a 529 vs. an ABLE account.

### Account Enrollment

- Done online at [ks.savewithable.com](https://ks.savewithable.com/) (PDF form available for paper).
- **Self-certification** for nearly everything; doctor's notes are filed with Treasury when used in lieu of SSI/SSDI eligibility.
- For a beneficiary under 18: parent self-certifies and opens it.
- For an adult beneficiary lacking legal capacity: the parent/guardian/conservator self-certifies that and opens it.
- If you have a choice between opening as **Parent**, **Guardian**, or **Conservator**, check with the Treasurer's office about which role applies to your situation.
- **Grandparents** opening for a grandchild: be prepared to document the family relationship chain.
- **Gifting platform:** [UgiftABLE.com](https://www.ugiftable.com/) — a free service that lets friends and family contribute directly into a loved one's ABLE plan account in lieu of traditional gifts. Generate a Ugift code, share it, and contributions go straight into the account. Great for graduation, birthdays, and fundraising drives.

### Fees

- **Account maintenance:** $56/year base. Going paperless saves $6.25/quarter ($25/yr); Kansas residents save another $1.25/quarter ($5/yr). **All-in for a KS resident with paperless: ~$26/year.**
- **Investment fees:** ~30 basis points on the aggressive option (0.04% admin + 0.26% program = 0.30%). Approximately $3/yr on a $1,000 balance. Or $30/yr on a $100,000 balance.
- **Checking option:** $2/mo, waived with $250 avg balance or paperless statements.

### Hypotheticals (Power of Compounding)

- **Newborn illustration (not a projection):** A $100 Empowerment Grant plus $50/paycheck contributions, assuming a hypothetical 6% annual return over 18 years, would compound to roughly $84,000. Actual returns vary.
- **Property purchased with ABLE never counts as a means-tested asset** — some families build ABLE balances with a future home purchase in mind.

### Edge Cases & Q&A Highlights

- **What if my child no longer needs disability benefits?** Close the ABLE (likely a non-qualified withdrawal). An HSA or Roth IRA may be more appropriate when SSI/Medicaid aren't in the picture. Consult an investment advisor.
- **Markets go up and down — ABLE balances will too.** Pick an allocation matched to your timeline.
- **SSDI vs. SSI:** SSDI is *not* means-tested — no asset cap, no need for ABLE on that count. But if a child receives SSDI *and* Medicaid, you still want ABLE to protect Medicaid eligibility.
- **Pulling from an SNT into ABLE:** transferring trust money to ABLE *does* trigger tax on the earnings portion of that withdrawal. Once it's in ABLE and grows for 5+ years, future growth is tax-free.
- **Can you contribute stock in-kind?** No — only liquid cash. (SNTs allow in-kind contributions.)
- **Successor ownership when the contributor dies:** if you die holding the 529 with intent to roll into a child's ABLE, the successor owner you've named on the 529 controls it. If your brother is the successor (not the beneficiary), no tax to him; if he were the beneficiary, the 529 would count as his asset and disqualify him for benefits.

### Related Resources

See `ABLE_Reference_List_Walrod_Nov2025.pdf` for the full compiled list. Highlights:

**ABLE Accounts:**

- [ABLE National Resource Center — Am I Eligible](https://www.ablenrc.org/get-started/am-i-eligible/)
- [ABLE National Resource Center — How to Open](https://www.ablenrc.org/am-i-able-eligible-and-how-do-i-open-an-account/)
- [Kansas ABLE Savings Plan](https://www.kansasstatetreasurer.ks.gov/able_savings.html)
- [Kansas ABLE Enrollment](https://savewithable.com/ks/home.html)
- [ABLE Plan Flyer](https://cdn.unite529.com/jcdn/files/UABLE/pdfs/ks-slimline.pdf)

**SSA Resources:**

- [SSA ABLE Guide PDF](https://www.ssa.gov/pubs/EN-05-10153.pdf)
- [SSA POMS Rules](https://secure.ssa.gov/poms.nsf/lnx/0501130740)
- [SSA Spotlight on Trusts](https://www.ssa.gov/pubs/EN-17-008.pdf)

**Special Needs Trusts:**

- [ABLE / SNT Comparison Chart (PDF)](https://www.ablenrc.org/wp-content/uploads/2022/11/2022_SNT_ABLE_comparison.pdf)
- [Special Needs Alliance](https://www.specialneedsalliance.org/)
- [Academy of Special Needs Planners](https://specialneedsanswers.com/)

**Kansas / Local:**

- [Heartland Special Needs Foundation](https://heartlandspecialneedsfoundation.org/)
- [ArCare Trust Services](https://arcare.org/)
- [Midwest Special Needs Trust](https://www.midwestspecialneedstrust.org/)
- [Disability Rights Center of Kansas](https://www.drckansas.org/)
- [Kansas Council on Developmental Disabilities](https://www.kcdd.org/)

### Contact

**Tom Treacy** — Deputy Assistant State Treasurer, Kansas State Treasurer's Office

- Email: tom@treasurer.ks.gov

**Other contacts from the official presentation:**

- **Steven Johnson** — Kansas State Treasurer
- **ABLE Empowerment Grant inquiries:** ABLEgrant@treasurer.ks.gov or 785.296.3342

## Attachments

- `ABLE_Empowerment_Presentation_2026.pptx` — Tom Treacy's official 25-slide presentation deck (2026 edition), with speaker notes covering the full history, eligibility rules, contribution limits, fee structure, and the Kansas ABLE Empowerment Grant
- `ABLE_Reference_List_Walrod_Nov2025.pdf` — Cherri Walrod's compiled reference list of ABLE accounts, SSA resources, Special Needs Trust organizations, and Kansas/local resources (November 2025)