New Jersey ABLE Accounts Update: Expanded Opportunities in 2026

For individuals with disabilities and their families, ABLE (Achieving a Better Life Experience) accounts remain one of the most valuable financial planning tools available. In 2026, several important changes have expanded access to these tax-advantaged savings accounts, allowing many more New Jersey residents to benefit from the program.

Expanded Eligibility: Disability Onset Age Increased to 46

The most significant change affecting ABLE accounts is the expansion of eligibility under federal law.

Beginning January 1, 2026, individuals whose qualifying disability began before age 46 may now open and maintain an ABLE account. Previously, eligibility was limited to individuals whose disability occurred before age 26.

This change significantly broadens access to ABLE accounts and is expected to benefit millions of Americans, including individuals living with:

Multiple sclerosis (MS)
Parkinson’s disease
Traumatic brain injuries
Stroke-related disabilities
Mental health conditions
Veterans with service-connected disabilities
Other disabilities that develop during adulthood

Many New Jersey residents who were previously ineligible may now qualify for an ABLE account for the first time.

Higher Contribution Limits for 2026

The IRS has increased the annual ABLE account contribution limit for 2026 to $20,000.

This means that family members, friends, and the account owner may collectively contribute up to $20,000 annually without affecting the account’s tax-advantaged status. In addition, eligible individuals who are employed may be able to contribute additional amounts through the ABLE to Work Program, subject to federal requirements and limitations.

These increased contribution opportunities allow individuals with disabilities to save more for future needs while maintaining important public benefits.

Why ABLE Accounts Matter

ABLE accounts were created to help eligible individuals with disabilities save and invest money without jeopardizing eligibility for certain government assistance programs.

Some of the key benefits include:

Tax Advantages

Tax-deferred investment growth
Tax-free withdrawals for qualified disability expenses
No federal income tax on earnings used for qualified expenses

Protection of Public Benefits

Account balances generally do not affect Medicaid eligibility
Preservation of eligibility for many means-tested federal benefits when balances remain within applicable program limits

Flexibility

Funds can be used for a broad range of disability-related expenses that enhance health, independence, and quality of life.

What Are Qualified Disability Expenses?

One of the greatest advantages of an ABLE account is the wide range of expenses that may qualify.

Examples include:

Housing and rent
Education and training
Transportation
Healthcare and medical expenses
Assistive technology
Employment support services
Personal support services
Financial management and legal fees
Basic living expenses related to the individual’s disability

This flexibility allows account owners to use funds for many of the everyday expenses associated with living with a disability.

What Hasn’t Changed

While eligibility has expanded, the overall structure of New Jersey’s ABLE program remains largely unchanged.

Participants continue to enjoy:

Flexible investment options
Convenient online account management
Tax-advantaged growth
The ability to save while preserving eligibility for important public benefits

These features continue to make ABLE accounts an essential component of disability and special needs planning.

Should You Revisit Your Eligibility?

If you were previously told that you did not qualify for an ABLE account because your disability began after age 26, now is an excellent time to revisit your eligibility.

The new age-46 eligibility rule opens the door for many adults who were previously excluded from the program. Individuals with later-onset disabilities should review the updated requirements to determine whether they can now take advantage of the savings and planning opportunities offered by an ABLE account.

The Bottom Line

The expansion of ABLE account eligibility is one of the most significant developments in disability financial planning in recent years. For many New Jersey residents, 2026 represents the first opportunity to establish an ABLE account, save for future disability-related expenses, and preserve access to essential public benefits.

Because ABLE accounts often work best as part of a broader special needs and public benefits strategy, individuals and families should consider seeking guidance before opening an account or making significant financial decisions.

If you believe you or a loved one may now qualify for an ABLE account, the attorneys at Weiss & Tom, LLC can help you understand the updated eligibility rules and determine how an ABLE account may fit into your overall special needs planning strategy. Contact our office to set up a consultation.