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Individual Development Account (IDA)

Individual Development Account (IDA)

A special type of savings account is available for employed individuals with disabilities. These accounts allow your child to save on his or her own without jeopardizing eligibility of government benefits. The savings account limits how the savings can be used, yet it may open up financial options your child might need to achieve dreams and goals.

Individuals who work but have limited income may be eligible for Individual Development Accounts. These are savings accounts offered by financial institutions, community- and faith-based organizations, and state and local governments. Each IDA program is different, but most require that an individual have a job and that his or her income does not exceed a certain level.

Specific IDA Programs for Individuals with Disabilities

A special federally funded IDA program allows your child to participate in an IDA program and still receive Supplemental Security Income (SSI) benefits. These special IDA programs are funded by the Assets for Independence Act (AIFA) or Temporary Assistance for Needy Families (TANF). Before your child enrolls in an IDA, it is very important that he or she ask the entity that is offering the IDA if it is funded by one of these federal programs. If it is not, assets in the IDA may affect your child’s eligibility for government benefits. Federal laws change. Always double check with a professional knowledgeable about IDAs, such as an IDA administrator at The Corporation for Enterprise Development (CFED) or a staff member at or Real Economic Impact .

Matched Savings Contributions

IDAs can really help your child build a savings. For every dollar your child saves, the entity providing the IDA will match that, at a rate of $1 to $4 for every dollar saved. For example, if your child saves $100 and the matched amount is $2 for every $1 saved (a 2:1 matching ratio), your child would receive $200 in matched funds for a total savings of $300.

Additional Financial Services Offered

Entities that offer IDAs usually provide other financial services, such as financial education, free income tax preparation services, and credit counseling.

What IDA Savings Can Be Used For

Some programs offer additional uses of savings, but generally IDA account holders can use the money to:

  • Continue their education beyond high school.
  • Buy a home.
  • Start a business.
  • Save money for the future.

Where to Find an IDA Program
Near You

Staff at a Volunteer Income Tax Assistance (VITA) site close to your home can let you know if a local entity offers IDAs designed for people with disabilities. To contact a local VITA site near you:

Call 800-829-1040
Visit www.irs.gov and search on “Volunteer Income Tax Assistance” to get a nationwide list of VITA sites.

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