The ABLE Employment Flexibility Act allows employers to contribute to ABLE accounts—tax-advantaged savings accounts for individuals with disabilities—as an alternative to making traditional retirement plan contributions. Under the bill, eligible employees with disabilities can elect to have their employer's retirement plan contributions redirected to their ABLE accounts instead, without affecting the employer's retirement plan's tax status or compliance with nondiscrimination rules. The legislation clarifies that employers can also make matching contributions to employees' ABLE accounts and treats these employer contributions as employee income for tax purposes. The bill also requires the Treasury Department to update regulations and employer guidance within one year to confirm these contributions are tax-deductible as reasonable compensation and to encourage employers to inform eligible employees about ABLE contribution options. The changes take effect for plan and tax years beginning after the bill's enactment.
Take Action
Your position
Add a comment
to comment on this bill.
Annotate the text
Highlight any passage on the Summary or Full Text tab to attach a note. Annotations appear on the Annotations tab.