Overview
Title
To amend the Internal Revenue Code of 1986 to make certain provisions with respect to qualified ABLE programs permanent.
ELI5 AI
The bill wants to let people keep putting more money in special savings accounts for people with disabilities without any end date, and it also lets them move money from certain college savings accounts into these special accounts. This means saving and planning for the future would be easier for them.
Summary AI
The bill, H.R. 9614, titled the “Ensuring Nationwide Access to a Better Life Experience Act” or the “ENABLE Act,” aims to make certain provisions for ABLE (Achieving a Better Life Experience) programs permanent under the Internal Revenue Code. It seeks to remove the expiration date before January 1, 2026, from provisions allowing increased contributions to ABLE accounts and rollovers to ABLE programs from 529 programs. It also allows for the continuation of tax credits for savers contributing to these accounts beyond that date. These changes will apply to tax years and distributions starting after the bill becomes law.
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AnalysisAI
Summary of the Bill
The proposed legislation, known as the "Ensuring Nationwide Access to a Better Life Experience Act" or the "ENABLE Act" (H.R. 9614), aims to modify specific provisions of the Internal Revenue Code of 1986 to make certain elements concerning qualified ABLE programs permanent. ABLE accounts, or Achieving a Better Life Experience accounts, allow individuals with disabilities to save money without impacting their eligibility for federal benefits. This bill intends to permanently extend the provisions related to increased contributions to ABLE accounts and the rollover from 529 education savings plans to ABLE accounts, removing the previous sunset clauses slated for January 1, 2026.
Significant Issues
The bill raises a number of noteworthy issues. Firstly, there is a lack of detailed analysis or justification for the proposed permanent extensions of increased contributions to ABLE accounts. This absence of explanation could lead to concerns about long-term fiscal responsibility and potential misuse of funds.
Additionally, the absence of a fiscal impact analysis regarding the allowance of the saver's credit introduces ambiguity regarding its effect on federal revenue and taxpayers. This could lead to concerns about the financial repercussions for the federal budget.
Furthermore, the permanent extension of rollovers from 529 plans to ABLE programs could benefit certain financial institutions or individuals who rely heavily on these savings plans. The implications of this extension require careful scrutiny to avoid any potential for undue advantage, which raises ethical and economic concerns.
Lastly, the technical language used in the bill, referencing specific sections of the Internal Revenue Code, may make it challenging for the general public to understand. This, paired with a vague effective date clause, could result in confusion about when and how these changes will be implemented.
Potential Impact on the Public
Broadly, the bill might have a favorable impact on individuals with disabilities and their families, as it would provide a consistent and reliable framework for saving and managing funds through ABLE accounts. Making these provisions permanent could assist in long-term financial planning, offering stability and security without the looming threat of an expiration date.
However, the absence of an in-depth financial impact analysis makes it difficult to predict potential costs to taxpayers and the overall budget. Should these extensions result in decreased federal revenue, there may be indirect impacts on public funds and governmental resources.
Impact on Specific Stakeholders
For individuals with disabilities and their families, the ENABLE Act is likely to be beneficial as it offers greater flexibility in managing their savings without threatening their eligibility for federal benefits. Likewise, financial planners and institutions that manage 529 and ABLE accounts may find increased business opportunities with the removal of rollover deadlines.
On the other hand, the permanent extension could create disparities if not implemented with oversight, potentially leading to advantages for those who are already financially savvy or have significant financial resources. Without fiscal analyses or consideration for broader economic implications, some stakeholders might perceive this lack of oversight as a gap in the legislative process, raising potential criticisms over equitable access and fiscal responsibility.
Issues
The lack of detailed analysis or justification for the permanent extension of increased contributions to ABLE accounts in Section 2 raises concerns about potential wasteful spending and the absence of economic or policy reasons supporting this change.
The absence of a fiscal impact analysis or estimate related to the allowance of the savers credit in Section 2 may lead to ambiguity regarding the financial implications for federal revenue and taxpayers.
Section 3's amendment affecting Section 529 plans and its potential benefits to certain financial institutions or individuals who rely on these plans requires scrutiny to ensure no undue advantage is conferred, highlighting possible ethical and economic concerns.
The highly technical language in Section 2, referencing specific sections of the Internal Revenue Code without providing context, could make it difficult for the general public to understand the implications of the changes.
The vague effective date clause in Section 2, which does not specify how soon after the enactment of the Act the taxable years would begin, could result in confusion about implementation timelines.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The first section of the bill sets the short title as the “Ensuring Nationwide Access to a Better Life Experience Act” or the “ENABLE Act”.
2. Permanent extension of increased contributions to ABLE accounts Read Opens in new tab
Summary AI
The section makes two amendments to the Internal Revenue Code by permanently extending certain provisions related to ABLE accounts and the saver’s credit, removing the previous expiration date of January 1, 2026, and states that these changes will apply to tax years starting after the law is enacted.
3. Permanent extension of rollovers to ABLE programs from 529 programs Read Opens in new tab
Summary AI
The bill permanently allows money to be rolled over from 529 education savings plans to ABLE accounts, by removing the previous deadline of January 1, 2026, for such rollovers. This change will apply to any distributions made after the law is enacted.