State savings account part of disabled man’s independence plan
‘Wonderful thing’: MiABLE disability savings program helps Livonia man prepare for future.
Aaron Martinuzzi was on his way to becoming a doctor when a freak diving accident during medical school changed his path in life.
Now, a MiABLE account is helping to ensure he stays on the road to independence.
“I think it’s a wonderful thing,” said the Livonia resident, 32, who opened a MiABLE account in February 2017, a few months after the program was launched within the Michigan Department of Treasury. “MiABLE will help me maintain my independence.”
Aaron took another significant step toward sustaining his self-sufficiency in October 2018, when he landed a full-time job at the Thomson Reuters office in Ann Arbor, where he’s a tax analyst assisting with the development of UltraTax tax-preparation software.
His MiABLE account will complement his steady income by providing a tax-advantaged way to accumulate a contingency fund for various expenses, he said. For example, Aaron said, his MiABLE savings could go toward paying home health aides or purchasing such needs as a car or adjustable bed. It will also serve as a source of long-term savings.
Indeed, the wide array of ways to use account proceeds is a key MiABLE feature, Aaron said. Qualified expenses include those related to education, housing, transportation, employment training and support, assistive technology and personal support services, health, prevention and wellness, financial management, quality of life improvements, legal fees and funeral or burial expenses.
The program also offers tax advantages. For example, any earnings from MiABLE’s various investment options are free from taxes, as are withdrawals applied toward qualified expenses. Also, starting in 2018, people who work and save some of their income in a MiABLE account may get a federal Saver’s Credit, cutting the amount they pay in taxes.
‘A healthy brain’
In 2010, while a student at the University of New England College of Osteopathic Medicine in Maine, Aaron was at a party when he dived into a pool and landed headfirst on the bottom.
He suffered a spinal cord injury that left him mostly paralyzed from the upper chest down, with just partial use of his right arm. “It was just bad luck,” he said.
He soon moved back in with his parents in his native Redford, where he underwent physical therapy and began contemplating his future.
In the meantime, his mom put her CPA training and comfort with poring through forms and documents to use and began navigating the realm of government assistance available to people with disabilities.
One important bit of information Aaron quickly discovered: Typically, individuals with disabilities can’t have more than $2,000 in assets to receive public benefits, such as Social Security Disability Income, Supplemental Security Income or home help assistance through Michigan’s Home Help Program.
That was before MiABLE was an option. Unlike other forms of savings, MiABLE doesn’t affect eligibility for government assistance, provided account balances don’t exceed $100,000.
To stay under the $2,000 asset limit, Aaron had to liquidate his Roth individual retirement account, which he had taken pride in establishing at a young age.
“There was a stretch of time when the $2,000 limit complicated managing my finances, while I was still figuring things out,” he said.
During that period, Aaron worked on a limited basis – as a tutor and receptionist for Kaplan Test Prep and completing individual tax returns and other projects at LMR & Associates, a CPA firm in Livonia where his mom manages the tax department.
But he was also careful not to exceed the income and asset limits that would disqualify him for government benefits.
Then he started thinking harder about his time ahead.
“I had no idea where things were headed for the long term,” said Aaron, who earned a bachelor’s degree from the University of Notre Dame and a master’s from Colorado State University. “I just knew that I was young with a healthy brain.”
Yearning to earn
Eventually, he decided it was time to fully engage that brain in the workforce.
“I could continue to rely on my mom and dad, but they won't be able to assist me forever," said Aaron, who now lives with his parents in an accessibly designed house in Livonia. "I need to be able to take care of myself. The more other people have to take care of the little things for you, the more overwhelmed they're going to be down the road.”
While the income from his full-time job will mean the loss of government assistance, Aaron figures he’s still coming out ahead financially – especially when accounting for his MiABLE account.
MiABLE allows account holders to save up to $27,140 each year. Of that, $15,000 can come from any source, including family and friends. And those with a job can save an additional $12,140 in earned income.
It’s that type of flexibility that will make MiABLE a key part of planning for his future, Aaron said.
“Just living with a disability, on a daily basis I already have to be concerned about a lot of extra, atypical things to start the morning,” he said. “Anything that simplifies planning for the future is appreciated.”
To find out if you or your family member is eligible for a MiABLE account, visit miable.org/qualification.php.