Michigan Senate Bill SB1000

Michigan 2023-2024 Regular Session

• Introduced: 9/17/24
• Refer: 9/17/24
• Report Pass: 10/17/24
• Refer: 10/17/24
• Report Pass: 10/23/24
• Engrossed: 11/7/24
• Refer: 11/7/24

Caption

Individual income tax: other; definition of internal revenue code under the MiABLE program; update. Amends sec. 2 of 2015 PA 160 (MCL 206.982).

Impact

The passage of SB1000 would likely enhance the functionality and accessibility of ABLE accounts for Michigan residents with disabilities, making it easier for them to manage their financial resources. By updating the references to the Internal Revenue Code and ensuring compliance with federal standards, the bill ensures that the program remains relevant and beneficial for individuals needing specialized financial management strategies. The updates could also encourage higher participation rates in the ABLE program, as individuals may perceive it as a more viable option for managing their finances.

Summary

Senate Bill 1000 seeks to amend the Michigan Achieving a Better Life Experience (ABLE) program established in 2015 by updating the definitions in the governing statute and providing clear guidelines for the administration of ABLE savings accounts. The primary purpose of this bill is to align the definitions and provisions of the Michigan ABLE program with the most current federal guidelines as stipulated in Section 529A of the Internal Revenue Code. The bill aims to ensure that Michigan residents with disabilities can benefit from tax-advantaged savings accounts without taxation on qualified withdrawals for disability-related expenses.

Sentiment

The sentiment surrounding SB1000 appears to be overwhelmingly positive, particularly among advocates for individuals with disabilities. There is a general consensus that updating and streamlining the ABLE program is crucial for providing these individuals with the financial tools necessary for improving their lives. Stakeholders have expressed the importance of maintaining the integrity of the program through alignment with federal standards, which some view as an essential step for growing and supporting the community of disabled residents in Michigan.

Contention

Notable points of contention primarily revolve around the interpretation of what constitutes 'qualified disability expenses' and how these expenses will be verified. While there is broad support for ensuring that the program remains aligned with federal guidelines, some stakeholders have raised concerns about the potential for bureaucratic delays in the processing of qualified withdrawals or changes to account ownership. Therefore, it will be critical for state agencies to implement clear and efficient procedures to alleviate such concerns once the bill is enacted.