Act now to save money when filing your 2022 tax return next year

Thanks to a new law enacted by the Delaware General Assembly, Delaware taxpayers have new opportunities to save money.

Delawareans who save for school with the DE529 Education Savings Plan may qualify for a new tax deduction on their state returns.

“While our office oversees the management of the State’s investment portfolios, we also administer the DE529 Education Savings Plan which allows people to invest in the future of their loved ones,” said State Treasurer Colleen Davis. “Implementing a new tax deduction for DE529 contributions strengthens our commitment to helping people achieve a quality education without facing the possibility of years of student loan payments.”

Delaware tax filers are now eligible to deduct up to $1,000 of contributions to DE529 Education Savings Plans each year on their Delaware tax return (or $2,000 for joint returns) with a few additional conditions.

The deduction will NOT be available for:

• Tuition in connection with enrollment or attendance at an elementary or secondary public, private, or religious school
• Individuals with a federal adjusted gross income greater than $100,000 (or $200,000 for joint returns).

“The Department of Finance is pleased to announce that this tax benefit will be available for qualifying contributions made throughout 2022,” said Secretary of Finance Rick Geisenberger. “With the completion of a newly launched personal income tax module of the State’s Integrated Revenue Administration System (IRAS), considerable programmatic changes were made to enable administration of this new tax benefit for qualifying 2022 tax filers.” Official notice of the “go-Live” for these technology updates was published to the December 2022 Register of Regulations, thereby allowing the tax deduction for qualifying contributions to DE529 Education Savings Plans made after December 31, 2021.

The passage of House Bill 145 earlier this year also creates a tax deduction for contributions to a DEPENDABLE account for people with disabilities. The deduction applies to any amount up to $5,000 ($10,000 for couples filing a joint return).

“DEPENDABLE allows individuals with disabilities and their families save money above the $2,000 threshold that jeopardizes state and federal means-tested benefits,” said Treasurer Davis. “DEPENDABLE accounts allow people with disabilities to be able to work, able to save, and able to thrive.”

Those without a DE529 Education Savings Plan or DEPENDABLE account can take advantage of the tax deductions by opening accounts today at 529.delaware.gov or able.delaware.gov.

August marks “ABLE to Save Month,” and Delaware State Treasurer Colleen Davis wants to use the opportunity to celebrate Delawareans with disabilities and the freedom, independence, and possibilities their ABLE accounts provide.

ABLE (Achieving a Better Life Experience) plans allow individuals with disabilities and their families to save for a broad range of expenses on a tax-advantaged basis without jeopardizing their benefits from supplemental security income (SSI), Medicaid and other state and federal programs.

“Since taking office, I have focused on three main priorities: bolstering retirement security and readiness, creating pathways to economic empowerment, and promoting a culture of financial excellence,” Treasurer Davis said, “and it’s important to remember those are my priorities for all Delawareans, including those with disabilities. I’m proud that our own ABLE program, DEPENDABLE, provides a way for those with disabilities to save for the future.”

People with disabilities who receive SSI benefits may not have more than $2,000 to remain eligible for SSI and Medicaid. This limitation makes it difficult for many people with disabilities to live the independent lives they deserve and desire.

“A DEPENDABLE account offers solutions that empower our most vulnerable residents to make long-term planning decisions,” Davis said. “The ability to save creates independence by promoting the importance of financial wellness.”

As of June 30, 2022, DEPENDABLE held 242 funded accounts with assets totaling more than $2.1 million.

In addition to the existing benefits of a DEPENDABLE account, Delawareans who save with DEPENDABLE now also receive a deduction on their state income tax.

“A new law passed by the General Assembly establishes a tax deduction of up to $5,000 ($10,000 for couples filing a joint return) for contributions to DEPENDABLE accounts,” Davis said. “I thank the members of the General Assembly and Governor Carney for joining me in helping people with disabilities and those that support them.”

For more information about DEPENDABLE, visit able.delaware.gov, or visit the National Association of State Treasurers to learn more about ABLE Savings Plans.

With the signing of House Bill 145, Delawareans who make contributions to DE529 Education Savings Plan accounts, or DEPENDABLE accounts, will be eligible for a deduction from their federal adjusted gross income (AGI) when filing their income taxes.

“Creating pathways to economic empowerment remains one of my top priorities for our office,” said State Treasurer Colleen Davis.” There’s no better way to create that safeguard than by saving, be it for education or the future needs of a person with a disability.”

The new law creates a tax deduction for any amounts up to $5,000 ($10,000 for couples filing a joint return) contributed to a DEPENDABLE account, and a similar deduction of up to $1,000 ($2,000 for joint returns) into the DE529 Education Savings Plan.

“DEPENDABLE is Delaware’s own ABLE (Achieving a Better Life Experience) program that allows individuals with disabilities and their families to save for a broad range of expenses on a tax-advantaged basis without jeopardizing their state or federal benefits,” Davis said. “There’s no limit to what people with disabilities can do so there’s no reason to limit their savings. This new tax deduction will help them save even more.”

The deduction will take effect for contributions made after December 31, 2021, by the account owner or anyone else.

A new deduction will also become available for contributions to DE529 Education Savings Plan accounts in some cases. Federal adjusted gross income will be reduced for any contribution up to $1,000 (or $2,000 for joint returns) with a few conditions.

The deduction will NOT apply to:

• Tuition in connection with enrollment or attendance at an elementary or secondary public, private, or religious school
• Individuals with a federal AGI greater than $100,000 (or $200,000 for joint returns).

Deductions for couples with an AGI below $200,000 are capped at $2,000.

The deduction for contributions to DE529 Education Savings Plan accounts takes effect on January 1st of the calendar year following notification from the Delaware Secretary of Finance to the Register of Regulations of the availability of the funds.

“A college degree should come with pride, joy, and hope for the future, not fear and worry over future student loan payments,” Davis said. “Incentivizing Delawareans with this additional tax benefit will hopefully increase their saving and reduce future debt.”

The Delaware Plans Management Board administers both DEPENDABLE and the DE529 Education Savings Plan. Board Chair Donna Vieira, executive vice president and chief commercial officer for Sallie Mae, sees the deductions as another valuable tool.

“A primary goal of the Plans Management Board is making saving a priority for Delawareans,” Vieira said. “I commend Treasurer Davis and members of the General Assembly for showing their commitment to the financial wellness of families up and down our state.”

“If a parent contributes just $1,000 a year to a 529 account beginning the year the child is born, the account could grow to $44,000 by the time the child turns 18,” said Rep. Krista Griffith, prime sponsor of the legislation. “Thanks to HB 145, more working families will be able to provide their kids with a nest egg for their education. It will also go a long way in supporting those in the disability community by allowing up to $5,000 in tax deductions for ABLE accounts.”

“Putting aside money for the future can be an incredibly difficult proposition for many working families,” said Sen. Trey Paradee, the Senate prime sponsor of HB 145. “Parents saving for college or putting money away to secure a stable future for their child with disabilities deserve our support. I want to thank Treasurer Colleen Davis for all of her hard work on getting this bill passed and a big thank you to Governor John Carney for signing this important legislation into law.”

Agency Also Kicks off Marketing Campaign to Encourage Seniors, Individuals with Disabilities to Get Vaccinated

WILMINGTON (Dec. 14, 2021) – The Department of Health and Social Services (DHSS) today announced a new toll-free number for Delawareans to request COVID-19 vaccinations for eligible seniors and people with disabilities who cannot access a vaccination location because of disability, age or severe illness. DHSS also kicked off a marketing campaign aimed at supporting seniors and individuals with disabilities to get answers to questions they have about the vaccine and boosters.

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In the Homebound Vaccination Program, DHSS is partnering with independent pharmacies in each county to deliver the vaccinations to eligible Delawareans 5 and older. Lt. Governor Bethany Hall-Long, DHSS Secretary Molly Magarik and others announced the new vaccination program during an event Tuesday at one of the independent pharmacies, Ivira Pharmacy in Wilmington. Other participating pharmacies are Ivira Pharmacy’s location in Milford, Camden Pharmacy, Seaford Pharmacy, and Express Pharmacy in Laurel.

“Nothing is more important than getting more Delawareans vaccinated,” Lt. Governor Bethany Hall-Long said. “As a state, we are committed to removing as many barriers to access as possible. A toll-free line that older Delawareans and others who are homebound can call to be assessed for an at-home vaccination is an important step. So, too, is a new marketing campaign featuring older Delawareans, caregivers and individuals with disabilities.”

Starting Dec. 15, all requests for a homebound vaccination or booster will be filtered through a toll-free number – 1-888-491-4988 – to be assessed and scheduled. Live operators will staff the toll-free line from 8 a.m. to 8 p.m. Monday through Friday, and 8:30 a.m. to 6 p.m. Saturdays. To learn more, visit DHSS’ website at VaccineAccessDE.com.

“One of the many lessons we’ve learned during the 21 months of this pandemic is that we have to meet communities where they are,” DHSS Secretary Molly Magarik said. “Today’s announcement is about meeting seniors, individuals with disabilities, their families and caregivers where they are. It’s about supporting them in getting access to the COVID-19 vaccine and boosters, and it’s about ensuring that we can answer the unique questions that seniors and people with disabilities have about the vaccine.”

Earlier this year, in the first phase of its Homebound Vaccination Program, community nurses with DHSS’ Division of Public Health and Division of Services for Aging and Adults with Physical Disabilities, along with contract nurses with the Division of Developmental Disabilities Services, worked with community partners, including DART Paratransit, to identify and vaccinate more than 500 Delawareans who are homebound.

In connection with this new phase, DHSS is launching a marketing campaign aimed at encouraging individuals with disabilities, their families and seniors to call the Division of Public Health at 1-833-643-1715 if they have questions about the COVID-19 vaccine or to visit DHSS’ webpage for information and resources at VaccineAccessDE.com. As part of the campaign, seniors, individuals with disabilities and their family members talked about what getting the COVID-19 vaccine has meant to them. The campaign is funded through grants from the U.S. Administration for Community Living.

“It is important for us to launch this campaign that specifically addresses the questions and concerns that older Delawareans and individuals with disabilities and their families may have,” said Melissa Smith, Director of DHSS’ Division of Services for Aging and Adults with Physical Disabilities. “We are excited because it features Delawareans telling their own stories in print and video messages in order to help others feel comfortable about reaching out with questions and any accommodations they might need to get the vaccine.”

The Centers for Disease Control and Prevention (CDC) has found that people with disabilities and seniors are at high risk for serious illness, hospitalization and death from COVID-19. In Delaware, about 80% of the 2,218 people who have died from COVID-19 were 65 or older.

To help protect people in vulnerable groups, it’s important that everyone get vaccinated, practice social distancing, wear face masks indoors in public, get tested as needed, and wash their hands. In Delaware, almost 63% of all Delawareans are fully vaccinated, including more than 91% of those age 65 or older. But only 55% of seniors 65 or older have gotten their boosters.

While Delaware does not have data on the percentage of people with disabilities who are vaccinated, about 79% of American adults with disabilities have reported receiving at least one dose of the COVID-19 vaccine, compared with 84% of adults without a disability, according to a U.S. Census Household Pulse Survey. The Census Bureau survey, which was conducted among more than 100,000 adults in two phases from June to August of this year, found that the disparities among individuals with disabilities persisted across all age groups, in most race and ethnicity categories, and across all types of disability, even though adults with a disability reported less hesitancy to getting vaccinated.

A CDC study, published in October, found that adults with a disability anticipate or experience more difficulty getting COVID-19 vaccinations than adults without a disability. To help improve vaccination rates, the CDC recommended reducing barriers to vaccination scheduling and making vaccination sites more accessible.

Delaware State Treasurer Colleen Davis is calling on Congress to expand eligibility for the Achieving a Better Life Experience (ABLE) Act.

Both the United States Senate (S. 651) and House of Representatives (HR. 1814) introduced bills to increase the age of onset for individuals with disabilities, allowing them and their families to establish tax-advantaged savings and investments.

Currently, a person can open an ABLE account if his or her disability began before the age of 26. If passed and signed into law, the ABLE Age Adjustment Act will raise the age-of-onset to 46 years old and increase the eligible participants by 6 million Americans.

“Thanks to the passage of the ABLE Act in 2014, individuals with disabilities can save for a broad range of expenses on a tax-advantaged basis without jeopardizing their benefits from supplemental security income (SSI), Medicaid and other federal or state programs,” said Treasurer Davis, “but those accounts can only be opened for those with early onset disabilities. Unfortunately, accidents, and debilitating medical issues, and many other unforeseen issues can take place after someone’s 26th birthday.”

As of the end of June, DEpendABLE, Delaware’s own ABLE program, had a total of 87 funded accounts and $753,000 in total assets. That represents 87 Delawareans who can earn and save money above current means-tested asset limits without losing their benefits.

Treasurer Davis and Daniel Madrid, Program Manager for DEpendABLE, joined colleagues from around the country this week in signing a letter to the Congressional Military Family Caucus that expressed the importance of support, especially for active military members facing the danger of injury, as well as disabled military veterans.

“We need congress to step up and help not only these brave men and women of the military who put their lives on the line for us, but every person living with a disability,” Treasurer Davis said. “I’m grateful and proud of Delaware’s lone Representative Lisa Blunt Rochester for co-sponsoring the legislation in the House, and for Senator Tom Carper agreeing to be a co-sponsor of the Senate bill. Senator Chris Coons told me he is supportive of our efforts and is considering working to raise the upper age for ABLE Act eligibility.

Opening a DEpendABLE account is easy and can be done online with as little as $25. Go to delawareable.com to enroll.