GREEN SHEET REDIGEST
HB 598 2015 Regular Session Foil
(KEYWORD, SUMMARY, AND DIGEST as amended by Senate committee
amendments)
EXCEPTIONAL PERSONS. Provides for implementation of the ABLE Account
savings program for persons with disabilities
DIGEST
Present law known as the "Achieving a Better Life Experience in Louisiana Act" or
"Louisiana ABLE Act", R.S. 46:1721 et seq., establishes a governance framework and broad
guidelines for a state ABLE Account savings program for persons with disabilities. Provides
that the purposes of the program include all of the following:
(1)To pay qualified disability expenses so that persons with disabilities may maintain
health, independence, and quality of life.
(2)To provide secure funding for disability-related expenses on behalf of designated
beneficiaries with disabilities that will supplement, but not supplant, benefits
provided through private insurance, Medicaid, the Supplemental Security Income
program, the beneficiary's employment, and other sources.
Proposed law revises and updates present law to provide for full implementation of the
ABLE Account program in a manner consistent with provisions of the Stephen Beck, Jr.,
ABLE Act of 2014 (Pub. L. 113-295), enacted Dec. 19, 2014, and referred to hereafter as
"the federal ABLE Act".
Proposed law revises definitions in present law in the following manner to provide for
consistency with the federal ABLE Act:
(1)Amends definitions of "ABLE Account", "ABLE Account Program" and "program",
and "qualified disability expense".
(2)Adds definitions of "designated beneficiary" and "eligible individual".
(3)Repeals definitions of "beneficiary", "department", and "person with a disability".
Present law sets forth purposes of the ABLE Account Program, referred to hereafter as "the
program". Proposed law retains present law and adds full compliance with the federal ABLE
Act as a purpose of the program.
Present law provides for treatment of the program consistent with Section 529 of the Internal
Revenue Code relative to qualified tuition programs. Proposed law revises present law to
provide for treatment of the program consistent with Section 529A of the Internal Revenue
Code, as enacted by the federal ABLE Act, relative to qualified ABLE programs. Deletes
all provisions of present law providing for equivalency of the program with qualified tuition
programs provided for in the Internal Revenue Code.
Present law creates and provides for a seven-member ABLE Account Authority, referred to
hereafter as "the authority" as the governance authority for the program. Provides that the
authority shall operate under the same laws, rules, and guidelines and with the same officer
selection and employment policies as the La. Student Financial Assistance Commission,
except when inconsistent with present law and proposed law pertaining to the program.
For purposes of organization of the executive branch of state government, present law, R.S.
36:802.24, transfers the authority to and places it within the Dept. of Health and Hospitals.
Proposed law amends present law to transfer the authority to and place it within the Dept. of
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Prepared by Jay Lueckel. Education. Further, proposed law adds the following four persons to the membership of the
authority:
(1)The executive director of The Arc of Louisiana or his designee.
(2)The executive director of People First of Louisiana or his designee.
(3)A person with a disability selected by the executive director of People First of
Louisiana.
(4)A parent or family member of a person with a disability selected by the chairperson
of the Louisiana Developmental Disabilities Council.
Proposed law requires the executive director of The Arc of La. to take all such actions as are
necessary to ensure that the members of the ABLE Account Authority are seated on or before
Sept. 1, 2015, and that the initial convening of the authority occurs no later than Dec. 1,
2015.
Proposed law authorizes the authority to enter into any contract, memorandum of
understanding, or other type of agreement with the La. Tuition Trust Authority as may be
necessary to provide for the co-location of administrative and clerical functions and
concurrent operation and management of the ABLE Account Program and the La. Student
Tuition Assistance and Revenue Trust Program, also known as the START Program,
established pursuant to Section 529 of the Internal Revenue Code and present law.
Present law specifies aspects of the program that the authority shall provide for in
administrative rule. Proposed law retains present law; stipulates that all functions, policies,
and requirements of the program provided for in rule must comport with the federal ABLE
Act and all federal regulations issued pursuant thereto; and adds the following as aspects of
the program that the authority shall provide for in rule:
(1)Individual eligibility factors, including the age limit before which a person's disability
must have occurred in order to be deemed an eligible individual for purposes of the
program.
(2)Applicant documentation and other standards relating to determination of eligibility
for the program.
(3)The number of ABLE Accounts per eligible individual.
(4)The establishment and imposition of limits on maximum annual contributions to an
ABLE Account.
(5)Separate accounting for each designated beneficiary.
(6)A limitation on the number of times per year a designated beneficiary may direct the
investment of contributions made to his ABLE Account.
(7)A prohibition on pledging of any interest in an ABLE Account or any portion thereof
to be used as security for a loan.
(8)Safeguards to prevent aggregate contributions on behalf of a designated beneficiary
in excess of the limit provided for in the federal ABLE Act.
(9)Types and categories of qualified disability expenses.
(10)Prevention of fraud and abuse with respect to amounts claimed as qualified disability
expenses.
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Prepared by Jay Lueckel. Proposed law provides that rules promulgated by the authority shall be subject to oversight
by the Senate Committee on Finance and the House of Representatives Committee on
Appropriations.
Proposed law provides for the duties of the state treasurer relative to the investment of funds
in ABLE Accounts, including investing monies in the same manner as monies deposited in
START Program accounts.
Consistent with the federal ABLE Act, proposed law provides that for the purpose of
determining eligibility to receive any federal means-tested assistance (e.g. Medicaid,
Supplemental Security Income, Supplemental Nutrition Assistance Program benefits, etc.),
or determining the amount of such assistance, the following amounts shall be disregarded for
an ABLE Account beneficiary:
(1)Any amount, including earnings thereon, in the ABLE Account.
(2)Any contributions to the ABLE Account.
(3)Any distribution from the ABLE Account for a qualified disability expense.
Proposed law provides that for tax years beginning on and after Jan. 1, 2016, amounts
deposited in an ABLE Account on behalf of any designated beneficiary may be excluded
from tax table income for purposes of La. income tax if authorized by applicable provisions
of R.S. 47:293(9)(a).
Proposed law acknowledges that information provided by the Internal Revenue Service (IRS)
through IRS Notice 2015-18 indicates, in pertinent part, the following:
(1)That the U.S. Treasury Department and the IRS are working on guidance related to
Section 529A of the Internal Revenue Code providing for qualified ABLE programs
as of the date of issuance of IRS Notice 2015-18 (March 23, 2014).
(2)The IRS anticipates that ABLE Account programs may be in operation in some states
before such guidance can be issued.
(3)The Treasury Department and the IRS do not intend for the lack of guidance to
discourage states from enacting their enabling legislation and creating their ABLE
programs.
Proposed law provides a legislative declaration in consideration of the foregoing indicating
that proposed law is intended to comply to the maximum extent possible with all federal
laws, regulations, and policies relative to ABLE Accounts in effect on the effective date of
proposed law.
Effective upon signature of governor or lapse of time for gubernatorial action.
(Amends R.S. 36:802.24 and R.S. 46:1722(1), (2), and (7)(intro. para.) and (h), 1723, and
1725(B)(2); adds R.S. 17:3093.1, R.S. 36:651(T)(6), and R.S. 46:1722(8) and (9) and 1726-
1729; repeals R.S. 36:259(Y) and R.S. 46:1722(4)-(6), 1724, and 1725(D))
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Education to the
original bill:
1. Require the executive director of The Arc of La. instead of the chairperson of the
La. Developmental Disabilities Council to ensure the seating of the ABLE
Account Authority members and the authority's convening.
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Prepared by Jay Lueckel. Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Education to the
reengrossed bill
1. Changed the legislative oversight committees for rules promulgated by the
authority from the legislative committees on health and welfare to the Senate
Committee on Finance and the House Committee on Appropriations.
Committee Amendments Proposed by Senate Committee on Finance to the reengrossed
bill
1. Provides for the duties of the state treasurer relative to the investment of funds
in ABLE Accounts, including investing monies in the same manner as monies
deposited in START Program accounts.
2. Provides that for tax years on or after January 1, 2016, amounts in ABLE
Accounts may be excluded for beneficiaries from tax table income if they meet
certain criteria of the code.
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Prepared by Jay Lueckel.