Bill > AB984

This bill introduces a new tax deduction for contributions to CalABLE accounts, which are savings accounts for individuals with disabilities established under the federal ABLE Act (Achieving a Better Life Experience Act of 2014). Specifically, for tax years between January 1, 2026, and January 1, 2031, taxpayers will be allowed to deduct the full amount they contribute to a CalABLE account when calculating their adjusted gross income. The bill requires the Franchise Tax Board to submit a report by January 1, 2031, analyzing the impact of the deduction, including the total amount of deductions claimed and whether the policy has increased contributions to CalABLE accounts. The primary goal is to encourage more savings for people with disabilities by providing a tax incentive, with success measured by tracking year-over-year increases in account contributions. The tax deduction provision is set to expire on December 1, 2031, making it a time-limited tax benefit designed to support families preparing financially for the long-term needs of individuals with disabilities. The bill takes effect immediately as a tax levy and includes specific performance indicators and data collection requirements as required for new tax expenditure legislation.

Budget and Finance

https://leginfo.legislature.ca.gov/faces/billStatusClient.xhtml?bill_id=202520260AB984