Nebraska State Treasurer Don Stenberg says he is very pleased with and encouraged by interim guidelines for the new tax-favored Achieving a Better Life Experience (ABLE) programs across the United States, including Nebraska. The new interim guidelines were announced today by the Internal Revenue Service.
“This will allow us to implement our Nebraska ABLE program in the manner which we had hoped to do when we announced key details of our program yesterday,” said Treasurer Stenberg, who is Trustee of Nebraska’s ABLE program, to be known as Enable and to be managed by First National Bank of Omaha.
In a news conference in the Capitol Rotunda on Thursday, Stenberg announced that First National Bank would be the program manager for Nebraska’s ABLE program and that the program will be operational by summer 2016. Stenberg was joined for the news conference by individuals with disabilities and their families, as well as State Sen. Kate Bolz, State Investment Officer Michael Walden-Newman, and First National Bank Executive Vice President Clark Lauritzen.
“In particular, I am very pleased that the IRS will no longer require states to obtain information about expenditures by plan participants and that states will no longer be required to seek and receive medical information about ABLE plan participants,” Stenberg said Friday after receiving the IRS announcement. “Had those requirements remained in place, the cost of the ABLE program would have increased substantially. With this new guidance from the IRS, I am looking forward to making the Nebraska ABLE plan available in summer 2016, as we discussed at our news conference yesterday.”
In its announcement, the IRS said the three changes it was making to the proposed rules for ABLE accounts “will make it easier for states to offer and administer ABLE programs.”
The IRS statement continued: “States, program administrators and other interested commenters identified the three areas for change this summer during a 90-day comment period and at an Oct. 14 public hearing on the proposed implementation regulations.”
Stenberg had written a letter to the IRS in July in which he identified his major concerns over the proposed federal ABLE regulations. He said he shared concerns raised by the College Savings Plans Network and supported many of the suggested revisions put forth by the network. Nebraska is a member of the network, which is made up of state-sponsored 529 college savings programs like Nebraska’s NEST. The federal ABLE legislation was modeled after the state-sponsored 529 college savings programs.
In his July letter, Stenberg said he strongly agreed with the network’s position that if three provisions, in particular, were not clarified soon, they could “substantially slow down and perhaps even halt the launch of ABLE programs anxiously awaited by families of individuals with disabilities.”
“It would be a great tragedy,” Stenberg wrote, “if persons with disabilities all across the nation were denied the benefits of the ABLE legislation for an extended period of time because of unworkable federal rules.”
The IRS said full details describing the changes were posted on IRS.gov at https://www.irs.gov/pub/irs-drop/n-15-81.pdf.
The IRS provided the following information about the two guidelines of most concern to Nebraska:
The IRS also provided information about a third guideline that also was changed:
