Overview

Title

To amend the Internal Revenue Code of 1986 to make certain provisions with respect to qualified ABLE programs permanent.

ELI5 AI

This bill wants to make it easier for people with disabilities to save money for the future by letting them put more money into special savings accounts called ABLE accounts without worrying about a deadline. It also allows moving money from one type of savings account (529) for education into these ABLE accounts forever.

Summary AI

S. 4539 aims to amend the Internal Revenue Code of 1986 to make certain provisions related to qualified ABLE (Achieving a Better Life Experience) programs permanent. Specifically, it removes the expiration date of January 1, 2026, for increased contributions to ABLE accounts and allowances for savers' credits. Additionally, it extends the ability to roll over funds from 529 programs to ABLE programs indefinitely. These changes would ensure continued support for individuals with disabilities to save and provide for their future needs.

Published

2024-06-13
Congress: 118
Session: 2
Chamber: SENATE
Status: Introduced in Senate
Date: 2024-06-13
Package ID: BILLS-118s4539is

Keywords AI

able programs internal revenue code 529 rollovers savers' credits disability savings permanent extension tax legislation fiscal impact enable act qualified able programs

Sources

Bill Statistics

Size

Sections:
3
Words:
374
Pages:
2
Sentences:
14

Language

Nouns: 112
Verbs: 25
Adjectives: 18
Adverbs: 1
Numbers: 24
Entities: 39

Complexity

Average Token Length:
4.02
Average Sentence Length:
26.71
Token Entropy:
4.51
Readability (ARI):
14.14

AnalysisAI

Summary of the Bill

The bill titled the "Ensuring Nationwide Access to a Better Life Experience Act" or the "ENABLE Act," aims to amend the Internal Revenue Code of 1986. It primarily focuses on making certain provisions regarding ABLE (Achieving a Better Life Experience) programs permanent. The bill proposes two key changes:

  1. Permanent Extension of Increased Contributions to ABLE Accounts: It removes the previous expiration date of January 1, 2026, for increased contributions allowances to ABLE accounts and the allowance of the saver's credit.

  2. Permanent Extension of Rollovers from 529 Programs to ABLE Programs: It similarly removes the expiration date for rollovers from education-focused 529 savings plans to ABLE accounts, extending this benefit indefinitely.

Both amendments become effective for taxable years or distributions made after the law is enacted.

Significant Issues

A few critical issues are associated with this bill:

  1. Lack of Justification for Permanent Extensions: The bill does not adequately explain why it is necessary to make these temporary provisions permanent, potentially leading to questions about unanticipated government spending and its justification.

  2. Ambiguous Financial Impacts: There is no fiscal impact analysis to understand how these permanent extensions will affect federal revenue, especially concerning the allowance of the saver's credit and rollovers from 529 programs.

  3. Complex and Technical Language: The bill's language is highly technical, referencing several specific sections of the Internal Revenue Code without providing context. This makes it challenging for the public to grasp its implications fully.

  4. Vague Implementation Timelines: The effective date clauses lack specificity about when the changes will take effect, creating potential confusion about implementation.

Broad Public Impact

The bill could impact the public broadly in several ways. By making these provisions permanent, individuals with disabilities and their families using ABLE accounts might benefit from enhanced financial planning options without fearing the loss of benefits in the future. This stability could lead to better financial security and improved quality of life.

However, without a thorough fiscal analysis, there is uncertainty about whether the changes could result in reduced federal revenue or increased government spending. Such impacts might eventually necessitate adjustments in other areas of the budget or affect government services.

Impact on Specific Stakeholders

Positive Impacts:

  1. Individuals with Disabilities and Families: With permanent provisions, users of ABLE accounts might achieve better investment strategies and financial support structures, promoting long-term savings and reduced reliance on traditional welfare programs.

  2. Financial Institutions: Companies managing ABLE and 529 programs could see a steady engagement with their products, potentially expanding their client base and services offered.

Negative Impacts:

  1. Potential Budgetary Constraints: As the exact fiscal impact is not provided, there could be budgetary stresses on state or federal programs if revenue offsets are required.

  2. Individuals Relying on Other Benefits: A shift in government spending, necessitated by increased allowances under the bill, could impact other social programs indirectly.

In conclusion, while the bill generally aims to provide more stability and benefits to specific groups, the lack of detailed analysis and discussions about fiscal impacts should be a consideration for stakeholders reviewing the implications of this legislative change.

Issues

  • The bill lacks a detailed explanation of the necessity and justification for the permanent extension of increased contributions to ABLE accounts (Sec. 2). This raises concerns about potential wasteful spending and the need for clearer fiscal analysis to justify the change, impacting transparency and accountability.

  • The permanent extension of rollovers to ABLE programs from 529 programs (Sec. 3) could unduly benefit financial institutions and individuals involved with these plans. A comprehensive review of the long-term economic impact and fiscal analysis is necessary to ensure no undue advantage is given.

  • The language throughout the bill is highly technical and references specific sections of the Internal Revenue Code without providing necessary context. This makes it difficult for laypersons to understand the implications, potentially reducing public engagement with and understanding of the law (Sec. 2 & Sec. 3).

  • The bill does not specify any fiscal impact analysis or estimates related to the allowance of savers credit and rollovers from 529 programs, leaving ambiguity regarding the financial implications of these changes on federal revenue (Sec. 2 & Sec. 3).

  • The effective date clauses are vague, as they do not specify how soon after the enactment of the Act the taxable years or distributions would begin, creating potential confusion about implementation timelines (Sec. 2 & Sec. 3).

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.