Individual Development Accounts (IDAs)

Frequent Pitfalls

Participating in an Individual Development Account (IDA) program that affects your benefits

If you are getting Supplemental Security Income (SSI) benefits or health coverage through Medical Assistance (MA) and plan to enroll in an IDA, it is very important that you find out who funds that IDA program.

If you are on SSI or MA, it is highly recommended that you enroll in a federally funded IDA rather than an IDA funded by some other source.

If you choose an IDA program that is not federally funded, you may become ineligible for your SSI or MA benefits because your IDA account could cause you to exceed their asset limits. You can have a nonfederally funded IDA that does not impact your SSI or MA eligibility if your IDA is part of your approved Plan to Achieve Self-Support (PASS). If you want additional strategies to have a nonfederally funded IDA excluded, Chat with a Hub expert.

The 2 federal programs that fund IDAs are Temporary Assistance for Needy Families (TANF) and the Assets for Independence Act (AFIA). However, you do not need to be enrolled in those programs to have an IDA funded by them.

Note: Not all people who get MA have asset limits for their MA coverage. People who get MA based on having a disability do have an asset limit. However, some people with disabilities get MA coverage due to having income below 138% of the Federal Poverty Guidelines (FPG), and people who get MA for this reason do not have an asset limit.

Failing to fulfill Individual Development Account (IDA) program requirements

If you do not fulfill the requirements of the IDA program, you may become ineligible to access the matching funds offered by the program. Be sure to review the requirements of your program carefully with your IDA caseworker.

You must have earned income to start an Individual Development Account (IDA) program

To open a federally funded IDA account, your earned income must come from work. IDAs funded by other sources may allow for income from other sources.

Most Individual Development Account (IDA) programs have a savings cap

Most IDA programs have a limit on the amount you can save. For example, your account may allow you to save up to $1,000. This savings limit is called the savings cap. Your money will be matched by the IDA program up to your savings cap. Any money you save above the savings cap will not be matched.

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