obtaining and submitting a Withdrawal Form. To request by phone, call the Customer Service Center at 1-855-529-ABLE (2253). To make the request online, go to , click on then and then a To use the paper “My Account,” “Asset Manager,” “Make Withdrawal.” Withdrawal Form, download it from the website or request it by calling the Customer Service Center. Additionally, to make a Non-qualified Withdrawal from your Checking Account Option, you may write a check, use an ATM, or use your debit card. Tax Consequences Generally the earnings portion of a Non-qualified Withdrawal will be subject to federal income taxes at the ordinary income tax rate of the Account Owner and an additional federal tax of 10%. Additionally, Account Owners who are Pennsylvania taxpayers will be subject to state income taxes. The Program will issue to the Account Owner a Form 1099-QA for the withdrawal that will specify the principal and earnings portions of the total withdrawal. In the event of a return of Excess Contributions (see Part 2.B.2.), the Form 1099-QA will be issued to the contributor. There are a number of exceptions to the federal 10% penalty. They are: Withdrawals paid to the estate of an Account Owner on or after the Account • Owner’s death; Withdrawals paid to an heir or legatee of the Account Owner on or after the Account • death; Owner’s Withdrawals paid as any part of a claim filed against the Account Owner or the • Account by a state under a state Medicaid (Medical Assistance) plan; Earnings on contributions returned because they would have exceeded the Annual • Contributions Limit; Earnings on contributions returned because they would have exceeded the total • Account Balance Limit; or Earnings on contributions to additional purported ABLE accounts withdrawn by the • due date (including extensions) of the Account tax return for the year in Owner’s which the relevant contributions were made. 5. Withdrawal upon Termination a. General The Pennsylvania Enabling law specifies that the Department may close an account without being directed to do so by the Account Owner or Authorized Individual if necessary to comply with
obtaining and submitting a Withdrawal Form. To request by phone, call the Customer Service Center at 1-855-529-ABLE (2253). To make the request online, go to , click on “My Account,” then “Asset Manager,” and then “Make a Withdrawal.” To use the paper Withdrawal Form, download it from the website or request it by calling the Customer Service Center. Additionally, to make a Non-qualified Withdrawal from your Checking Account Option, you may write a check, use an ATM, or use your debit card. Tax Consequences Generally the earnings portion of a Non-qualified Withdrawal will be subject to federal income taxes at the ordinary income tax rate of the Account Owner and an additional federal tax of 10%. Additionally, Account Owners who are Pennsylvania taxpayers will be subject to state income taxes. The Program will issue to the Account Owner a Form 1099-QA for the withdrawal that will specify the principal and earnings portions of the total withdrawal. In the event of a return of Excess Contributions (see Part 2.B.2.), the Form 1099-QA will be issued to the contributor. There are a number of exceptions to the federal 10% penalty. They are: • Withdrawals paid to the estate of an Account Owner on or after the Account Owner’s death; • Withdrawals paid to an heir or legatee of the Account Owner on or after the Account Owner’s death; • Withdrawals paid as any part of a claim filed against the Account Owner or the Account by a state under a state Medicaid (Medical Assistance) plan; • Earnings on contributions returned because they would have exceeded the Annual Contributions Limit; • Earnings on contributions returned because they would have exceeded the total Account Balance Limit; or • Earnings on contributions to additional purported ABLE accounts withdrawn by the due date (including extensions) of the Account Owner’s tax return for the year in which the relevant contributions were made. 5. Withdrawal upon Termination a. General The Pennsylvania Enabling law specifies that the Department may close an account without being directed to do so by the Account Owner or Authorized Individual if necessary to comply with
Program-Disclosure-Statement.docx