People who live with disabilities often have less income and fewer assets than the rest of the population. If you depend on public benefits programs, it can be hard to think about saving money for the future. If you live only on the money you get from Supplemental Security Income (SSI) you will be below the poverty level. Many other programs have asset limits that make it hard to save money.

It can seem like public benefits programs are a trap; they don’t give you enough money to cover all your expenses and they restrict your options for building assets and making more money. And, if you want to make a change in your life, it can be hard to try and follow all the rules that you need to in order to keep your benefits.

Building assets is an important part of becoming financially independent. Even if you face obstacles that make it hard to save money, building assets should be a priority. If you don’t have assets, it is much harder to become economically secure.

Assets give you an economic cushion and open the door to more opportunities. Careful planning can make it possible to build wealth, buy a home, or start a business, while still having enough money to live on. The economic stability that comes with assets can help you meet your goals, let you work toward freedom from dependence on benefits, and increase your wealth.

Financial Literacy

Developing a general understanding of finances (or “financial literacy”) and skills such as budgeting and long-term financial planning is important for everyone. But it is especially important if you have to follow the low-income and asset rules of public benefits programs.

Learning about finances can help you do big things like pay for college, buy a house, or plan for old age. It can also help you stay away from scams and prepare for unexpected expenses and difficult life events.

There are several reasons financial literacy is especially important for people with disabilities:

• People with disabilities have higher out-of-pocket costs for everyday activities

• People with disabilities can have high medical costs (and medical debt is a major cause of bankruptcy for all people)

• Relying on public benefits programs is hard. There are a lot of rules and restrictions about money and assets that most people don’t ever have to think about

If your disability began before you turned 26 and it meets the Social Security Administration's disability standards, you can open an ABLE account. (SSA has different disability standards for children, adults, and blindness.)

An ABLE account is a financial account that can help you:

• Build assets in an account that has tax advantages. Your investments in an ABLE account won’t be taxed, so your wealth will grow faster. Plus, If you work and save earned income in your ABLE account, you may qualify for the federal Saver’s Credit.
• Use your savings on many types of expenses. There are rules about spending the money in your ABLE account, but there’s also a lot of flexibility.
• Save up money without losing benefits. Many benefits programs have asset limits, but:
  • You can have up to $100,000 in your ABLE account and keep getting Supplemental Security Income (SSI) benefits, as long as you meet all other SSI rules. If you go over $100,000, SSI benefits will stop, but they will start up again if your ABLE account drops back below $100,000 and you won't have to reapply.
  • For Medical Assistance and the Supplemental Nutrition Assistance Program (SNAP), the money in your account will not affect your benefits, no matter how much you have.
  • The money in your ABLE account may not be counted for some other benefits. Check with program representatives to make sure.

The bottom line: An ABLE account means that you can save up money without losing your benefits. It also lets family and friends give you money without affecting your benefits.

Note: After you die, money in your ABLE account may be used to pay back the MA program. Look into third-party Special Needs Trusts if this is an issue for your family.

ABLE account rules are introduced below and covered in detail in DB101's ABLE Accounts article.

Opening an ABLE Account

There are a few main rules for opening an ABLE account:

• You can only open an account through a state-designated program or institution.
  • Minnesota ABLE Plan is Minnesota's ABLE account program.
  • You can choose to open an account in another state’s ABLE program.
• You can only open one ABLE account. (You cannot open accounts in more than one state.)
• You must have a disability that qualifies for an ABLE account and that began before you turned 26.
  • You can be more than 26 years old when you open your account – all that matters is when your disability began.

You can only have an account if you have a disability. However, another person, such as a parent or guardian, can help manage the account.

Comparing State ABLE Programs

Some states offer ABLE accounts and others don’t. Minnesota ABLE Plan is Minnesota's ABLE account program. Even if your state has an ABLE program, you should compare different state ABLE account programs to see which state’s program is best for you.

When you compare ABLE programs, think about these questions:

• How easy is it to put money in the account and take money out for qualifying expenses? For example, does it come with a debit card?
• How good is customer support? Try calling the program to see whether it seems helpful.
• What investments does it offer? Each state program offers different investment options. Choose a program that offers investments matching your needs.
• What fees does the program charge? There may be fees for opening the account and for keeping money in it.
• Does the program offer any extra benefits for people living in your state? For example, some state programs offer extra tax benefits for residents of that state.

Note: You can switch your ABLE account from one state program to another. You do not have to stick with the state program you choose.

Compare the ABLE account options in different states.

Rules on Depositing Money in an ABLE Account

There are two limits on how much money can be deposited in an ABLE account in a single calendar year:

• Up to $19,000 in total deposits can come from any source (you, your family and friends, your benefits, and other unearned income), plus
• If you have a job, another $15,060 in deposits can come from your own earned income.
  • Note: If you or your employer make contributions to a retirement plan set up by your employer, you might not qualify for the extra ABLE contribution amount based on having a job (you can still make regular ABLE contributions). If you aren't sure about this, ask your ABLE account program or check with a tax expert. Get more information about this rule from the ABLE National Resource Center.

Important: You need to keep good records, to make sure that too much money isn’t put into your account.

State ABLE programs also have limits on the total amount in your account — typically $200,000 to $500,000, depending on the state. For example, if the cap is $300,000, you cannot make a deposit until your account balance drops below $300,000 again.

Rules on Spending Money in an ABLE Account

The money in an ABLE account has to be used for certain qualifying expenses, like:

• Daily living expenses
• Education
• Housing
• Transportation
• Help getting and keeping work
• Health care
• Assistive technology
• Legal fees
• Financial management fees, and
• Other approved expenses.

Many expenses qualify. For example, your rent, electric bill, and furniture are housing expenses. Gasoline and car repairs are transportation expenses. Health insurance premiums and copayments count as health care. Lunch at a restaurant, toothpaste, and toilet paper are daily living expenses.

Keep receipts whenever you use your ABLE account to pay for a qualifying expense. If you are audited by the IRS, you’ll need to show them how you’ve used your money. You can put all of the receipts into a binder or scan them and save them on your computer.

How Spending Works

An ABLE program may offer a debit card that is linked to the account. If so, you can use the debit card whenever you pay for a qualifying expense. For things like rent, you may need to write checks or withdraw cash from the account instead. You don't need authorization to spend your money: it's your job to make sure your expense qualifies and to keep records of how use your ABLE account.

If you withdraw cash from an ABLE account, spend it on your qualifying expense. Don’t just hold onto the money or put it in a normal bank account – if you don’t spend the money, it could be counted as a resource for benefits programs. For example, if you take $3,500 out of an ABLE account and put it into a regular checking account instead of spending it, you will go over the resource limit for SSI.

As long as the money stays in the ABLE account, it won’t affect your benefits, so leave your money there until you need to spend it.

Learn more in DB101's article on ABLE accounts.

Individual Development Accounts, also known as “IDAs,” are special savings accounts. You choose a goal to save for and use the IDA account to save money towards meeting that goal. IDA goals are usually buying a first home, education or training costs, or funding for a small business.

The money you put into the account will be matched by other sources. The match may be anywhere from one to four times the amount of the deposit you make. For example, if you’re enrolled in an IDA program with a 2:1 match and you deposit $50 into your account, the program will add an additional $100 towards your savings goal.

There are more than 250 IDA programs nationwide. Their eligibility requirements can be different. Generally, to qualify for an IDA:

• Your annual income must be within 200% of the Federal Poverty Guidelines ($31,300 per year if you're single), and
• You must have some form of earned income

Once you’re enrolled in the program, you also need to take financial education classes.

To research IDA programs in Minnesota, check out Minnesota’s statewide IDA program, Family Assets for Independence in Minnesota (FAIM)

Funding Sources

Funding for IDAs comes from a variety of places, including government agencies, private companies, non-profits, and individual people.

If you are getting Supplemental Security Income (SSI), Minnesota Supplemental Aid (MSA) or disability-based Medical Assistance (MA) benefits and plan to enroll in an IDA, it is very important that you find out the funding source for that IDA program.

• If you enroll in a non-federally funded IDA (for example, one funded by a nonprofit or private company), money deposited and matched in your IDA may put your SSI, MSA, or MA benefits at risk.

• But if you enroll in an IDA program that is federally funded through Temporary Assistance for Needy Families (TANF) or the Assets for Independence Act (AFIA) block grants, money deposited won't be counted as a resource and a portion of it will be excluded by SSI and MA.

If you are on SSI or disability-based MA, it is highly recommended that you enroll in a TANF or AFIA funded IDA, rather than one funded by some other source, so that you don’t risk losing your benefits. If you have questions about this, Chat with a Hub expert.

Program Eligibility

Each IDA program is different and eligibility requirements may vary from program to program. Most require that:

• Your annual income is within 200% of the Federal Poverty Guidelines ($31,300 per year for an individual, $42,300 for a couple), and

• You have earned income

For an AFIA or TANF funded IDA, you must have income from work. It doesn’t matter if you’re working full-time or part-time, but you must be earning income from some sort of job. IDAs that are funded by other sources might have slightly different earned income requirements and allow for income from other sources.

Citizenship Requirements

IDA programs funded by the federal government may check on your citizenship or legal residency status when you apply. IDA programs funded by other sources may or may not do this. Be sure to ask about specific citizenship requirements when looking at IDA programs.

Financial Literacy Training

Once you’re enrolled in an IDA program you must take their free financial literacy training. Financial literacy programs improve your ability to manage your personal finances, save more money, and do financial planning.

This training usually covers topics like:

• Money
• Debt reduction
• Developing a savings plan
• Credit, and
• Investing

IDA Savings Limit

Most IDA programs only let you save a limited amount of money in your account, usually $4,000 to $6,000. This includes the money you deposit, as well as the matching funds. Once you reach the limit, you won’t be allowed to deposit any more money into the account. IDA programs also have a limit on how long you can save, usually two or three years.

How to Apply

If you are interested in starting an IDA, contact an IDA program in your area. Ask if they are accepting applications. Some programs may have waiting lists. Even if they do, you may be able to start by taking financial literacy training while waiting for a space to open up.

For Minnesota residents, a good place to start is the Family Assets for Independence in Minnesota (FAIM) program website

Once you find an IDA program that fits your needs, you should go to an orientation meeting to learn more about it.

You will also need to provide information to prove your eligibility for the program. If you get into the program, you will have an IDA caseworker who will help with your account. You’ll open a savings account with a bank or credit union that is connected to your IDA program. Depending on the program, you may need to deposit a certain amount into your account each month.

Once you’ve reached your savings goal, you can take money out of the account to spend on your goal.

Integration with Other Benefits Programs

IDAs, Supplemental Security Income (SSI), and Medical Assistance (MA)

Because SSI and disability-based MA have income and asset limits, working and saving money in an IDA account could risk your eligibility for those programs. Be sure to find out about the funding source before you enroll in a certain IDA. Note: If you qualify for MA based on your income and not based on your disability, there may be no asset limit for you. See DB101's MA article for more information.

• If you enroll in an IDA program that is federally funded via Temporary Assistance for Needy Families (TANF) or the Assets for Independence Act (AFIA), you don’t need to worry about losing your benefits. Money deposited will not be counted as a resource and a portion of it will be excluded for SSI or MA.
• If you enroll in an IDA program that is funded by some other source, money deposited into your IDA may be counted as a resource and you could lose your SSI and MA benefits.

If you are on SSI and disability-based MA, you should enroll in an AFIA or TANF funded IDA.

IDAs and Minnesota Supplemental Aid (MSA)

The state of Minnesota gives extra money to many people who are eligible for SSI (and low-income people on SSDI). This state supplement is called Minnesota Supplemental Aid (MSA).

To keep MSA, your countable assets must stay below the program's $10,000 asset limit. If you enroll in a federally funded IDA program, working and saving money in an IDA account will not risk your eligibility for MSA by putting you over the income and asset limits.

IDAs and Plans to Achieve Self-Support (PASS)

A Plan to Achieve Self-Support (PASS) is an SSI program that lets you set aside money for a specified work goal, such as:

• Starting a new career
• Going back to school

The money you set aside in a PASS does not count against SSI's income and resource limits. This means you can save money towards a career goal in a PASS and continue to use SSI benefits for basics like food and rent.

An IDA can be a part of your PASS plan; the only requirement is that your goal for each program be the same. One of the benefits of using the two together is that it lets you to set up a non-federally funded IDA without risking your SSI or MA benefits.

As long as the money you save in your IDA is part of a PASS plan, it will not be counted by SSI or MA and won’t jeopardize those benefits.

IDA’s and Social Security Disability Insurance (SSDI)

People on SSDI can enroll in any IDA program they choose. There are no restrictions.

IDA’s and the Earned Income Tax Credit (EITC)

The Earned Income Tax Credit (EITC) is a federal tax program that lowers the amount of income tax owed by low to moderate-income workers and families. Money you get from an EITC can be put into an IDA and matched, helping you to reach your savings goal faster.

Plan to Achieve Self-Support (PASS)

Social Security’s Plan to Achieve Self-Support (PASS) program lets you save money without lowering your income. Usually, if you get SSI monthly cash benefits, your SSI benefit goes down when you get income from other sources (like a job or Social Security Disability Insurance).

If you are in this situation, you probably have to spend a lot of your monthly income on basic expenses like food and housing. This can make it hard to save for things like job training or school.

The PASS program helps make saving easier. It lets you save money for a work-related goal that will help you become self-sufficient. It is easy to use because it protects your income while you save.

You can use a PASS to:

• Help pay for the cost of school or training
• Start a business
• Pay for equipment, support services, and other expenses related to your goal

One of the things that make PASS unique is that it is completely consumer-driven. The PASS plan is about your work goal, what you want to achieve, and what you need to get there.

After you write your PASS, you ask Social Security to approve it. Your plan has to have a realistic goal given your abilities, experience, and educational background.

Income Sources for Funding a PASS

Once you have an approved PASS plan, you will put money into your PASS account to pay for each step along the way to reaching your goal.

You cannot put any money you get from SSI in your PASS account. You must use money from some other source such as income from a job, or money from a spouse or parent.

Applying to the PASS Program

There is a detailed description of how to set up a PASS in the DB101 PASS section. You have to fill out Social Security’s PASS application form. On the application you will describe your goals for work and how you plan to achieve them.

This description should be detailed enough to convince Social Security that:

• You have a clear plan
• The plan is something you can realistically do, and
• If you completed the plan your need for SSI or SSDI would be lowered or eliminated

Application Assistance

Creating your plan and filling out a PASS application can seem intimidating, but you can get help with every step of the process by talking with a PASS Cadre. A PASS Cadre is a professional who knows about the program and is available to help you take advantage of it. You can contact the

• St. Paul PASS Cadre (serving all of Minnesota) at 1-866-667-6032, ext. 34021

Using a PASS

After your plan is approved, Social Security will send you detailed instructions about how to use your PASS. The instructions are mostly about keeping PASS funds and expenses separate from your other money, and keeping good records. You have to follow the rules carefully. To learn more, see the full PASS section.

If a medical situation or some other issue comes up that affects your ability to continue your PASS, talk to your PASS Cadre about your options. In many cases, you will be allowed to put your PASS plan on hold for up to 12 months without having to reapply.

Family Self-Sufficiency (FSS) Program

The Family Self-Sufficiency (FSS) program helps families who get help with their rent from programs funded by the U.S. Department of Housing and Urban Development (HUD).

It helps families whose income goes up because of work. When the family income goes up and the program starts paying less for rent, the FSS program takes the money that it saves on rent and sets that money aside for the family. The family can use these savings for purchases, such as the down payment on a home or a car.

The FSS program can help people who get help from programs like:

• Public housing
• The Section 8 housing choice voucher program
• Section 8 project-based rental assistance
• Some other project-based housing programs, and
• Some special purpose vouchers, including Veterans Affairs Supportive Housing (VASH), Family Unification Program (FUP), Foster Youth to Independence (FYI), and Mainstream.

Check with your public housing authority (PHA) or with the administrator of your housing program to see if the FSS can help you. Learn more about the FSS program.

Earned Income Tax Credit (EITC)

The Earned Income Tax Credit (EITC) is designed to help people with low income by lowering the amount of federal income tax they owe. Even if you don’t earn enough money to owe federal income taxes, you may be able to get an EITC.

Eligibility

To qualify, you must have income from employment, self-employment, or employer-paid disability benefits that is below certain limits and you must file your federal taxes.

The amount you get from your EITC depends on your Adjusted Gross Income (AGI), whether you are married, and the number of children you have. For 2025 (filing taxes by April 2026), the EITC ranges from $2 to $8,046.

Earned Income

To qualify for an EITC, you must have earned income. This can include your wages, salaries, tips, net earnings from self-employment, or any other form of taxable pay. You can also elect to include nontaxable combat pay as earned income.

The EITC program considers employer-paid disability payments that you get before retirement earned income. But benefits payments from a policy you paid the premiums for, or that you got after retirement, would not be considered earned income.

Other things that do not qualify as earned income under the EITC include:

• Interest and dividends
• Social Security and railroad retirement benefits
• Pensions and annuities
• Alimony and child support
• Workers’ compensation benefits
• Unemployment compensation
• Welfare benefits
• Veterans benefits

If you are married and filing jointly, at least one spouse must have earned income to be eligible for an EITC.

Adjusted Gross Income and Qualifying Children

In addition to the earned income requirement, you must have an adjusted gross income (AGI) below certain levels to qualify for an EITC.

Your adjusted gross income (AGI) includes all earned income before deductions for taxes, health care or other expenses, minus certain business, education-related, and other expenses. While filling out your annual tax return (IRS Form 1040), you will be asked a series of questions that will let you figure out what your AGI is.

For a child to be considered a qualifying child under EITC, several requirements must be met:

• Relationship: If you are claiming one or more child, they must be the taxpayer’s son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, or a descendant of any of these (for example, your grandchild, niece, or nephew)

• Residence: The child must live at the same residence as the taxpayer for more than half the year and have a valid Social Security number

• Age: At the end of the tax year, the child must be under 19. Or, if going to school full-time, the child must be under 24. The only exception is for people who are permanently and totally disabled. If the taxpayer’s child is permanently and totally disabled, there is no age requirement

According to the IRS, a person is considered “permanently and totally disabled” if their condition is expected to last continuously for at least one year or is expected to result in death, and if they cannot perform any Substantial Gainful Activity (SGA). For 2025, this means they cannot work and earn more than $1,620 per month ($2,700 if you are blind).

Note: Qualifying children can only be used by one family member to claim an EITC.

How to Get an EITC

If you qualify, you will claim your Earned Income Tax Credit when you file your federal tax return, IRS Form 1040. If you have a qualifying child, be sure to attach a Schedule EIC.

To calculate the value of your EITC, you can use the Earned Income Credit Worksheet in your 1040 instruction booklet. Or you can ask the IRS to calculate it for you by noting an “EIC” on the Earned Income Credit line on your tax return.

To figure out whether or not you are eligible for an EITC, and to see what the value might be, use the IRS EITC Assistant.

Tax Preparation Tips for Claiming the EITC

Keep all your W-2's and keep a record of who you have worked for during the year. This will make things simpler when it comes time to file your taxes.

If you are on a limited income, do not pay someone to do your taxes. Use a Volunteer Income Tax Assistance (VITA) Center to file. Most centers can e-file your return for free. If you are self-employed, have all your receipts and a log of expenses ready for the tax preparer.

Be sure to file your taxes, even if your income is lower than the amount at which you are legally required to file. You might be eligible for an EITC or some other tax credit that you can’t get without filing. Many families with children who qualify for an EITC may also be eligible for a Child Tax Credit (CTC).

The following is a summary of the EITC requirements:

Interaction With Other Disability Benefits Programs

Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI)

You must have some form of earned income to qualify for an EITC. Social Security benefits do not count as earned income under the program. You can, however, be on SSI or SSDI and claim an EITC, as long as you have some form of earned income.

If you're on SSI, you should spend any money you get from an EITC within 12 months. If you don't, Social Security will count that money toward SSI's resource limit.

Individual Development Accounts (IDAs)

Money from an EITC can be put into an Individual Development Account. This lets you get matching funds from the IDA program sponsor.

Plans to Achieve Self-Support (PASS)

Money from an EITC can be set aside in a PASS. This will let you reach your employment goals more quickly, by saving money without affecting the way your income is counted.

Long-Term Disability Insurance

Employer-paid long-term disability insurance benefits that you got before retirement count as earned income under EITC and can therefore be used to qualify for the program. Disability insurance benefits which you pay the premiums for, or that you get after retirement, are not considered earned income and can’t be used to qualify for an EITC.

Volunteer Income Tax Assistance Program (VITA)

The IRS Volunteer Income Tax Assistance Program (VITA) offers free tax help for taxpayers who qualify.

The VITA Program offers free tax help to low- to-moderate income (generally, $67,000 and below) people who can’t prepare their own tax returns. Certified volunteers are available to help prepare your taxes and they will make sure you get special credits, such as Earned Income Tax Credit, Child Tax Credit, and Credit for the Elderly or the Disabled. In addition to free tax return preparation help, most sites also offer free electronic filing (e-filing).

VITA sites are generally located at community and neighborhood centers, libraries, schools, shopping malls, and other convenient locations. To locate the nearest VITA site, visit Minnesota Revenue or call 1-800-652-9094.

Child Tax Credit (CTC)

The Child Tax Credit (CTC) is available to parents with children under age 17. CTC gives these parents a $2,000 tax credit for each child in the family under 17. Eligible families must be working and earning at least $2,500 a year.

Note that if you're on SSI and get money from a CTC, you should spend it within 12 months. After 12 months, Social Security will count that money toward SSI's resource limit. If you have any questions about this, Chat with a Hub expert.

Other Programs

If you or your spouse is a U.S. citizen who got taxable disability income and was permanently and totally disabled during this tax year, you may be eligible for the Credit for the Elderly or the Disabled.

A guide to other employment supports for people on SSI is available here.