SB 158

This bill requires the Department of Financial Institutions to study and report

on establishing a Wisconsin qualified ABLE program under section

529A

of the

Internal Revenue Code allowing tax-exempt accounts for qualified expenses

incurred by individuals with disabilities.

Under current federal law, states may create a qualified Achieving a Better Life

Experience program under which an individual may establish a tax-exempt savings

account to pay for qualified expenses, such as education, housing, and transportation

costs, for a beneficiary who is an individual with disabilities, as defined under federal

law. Although these accounts, commonly referred to as “ABLE accounts” or “section

529A accounts,” cannot be established under this state's law, they can be established

under another state's law, and if so established, withdrawals from these accounts for

payment of qualified disability expenses for the account beneficiary are exempt from

taxation in this state.

This bill requires DFI to conduct a study to examine the advantages and

disadvantages of the following options in establishing a Wisconsin ABLE program

for this state's residents: 1) DFI establishes and administers the ABLE program; or

2) DFI enters into an agreement with another state, or with an entity representing

an alliance of states, to establish and administer the ABLE program. The study must

include review and evaluation by DFI of certain matters, including each option's

potential costs; the impact of each option on Wisconsin residents' program choice, tax

benefits, and account fees; and ABLE programs offered by other states. DFI must

report to the legislature the results of the study, including DFI's findings and

recommendations, by approximately six months after the bill's effective date.