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How Can I Take Advantage of Trusts as an SSI Recipient?


If you currently receive benefits under the federal Supplemental Security Income (SSI) program, you’re probably aware of the general eligibility rules. You must be over 65 years old, blind, or disabled, AND your income and assets must also fall below the thresholds established by the Social Security Administration (SSA). The financial requirement can be a serious issue if you receive a significant amount of money, such as through inheritance. Your SSI benefits are in jeopardy because you may now have assets that make you ineligible.

Fortunately, there are strategies for placing assets into a qualifying trust, which preserves your eligibility for SSI and enables you to take small distributions for designated purposes. While you should always rely on a Maryland SSI disability lawyer for assistance, some background information may be useful.

Financial Rules for SSI Eligibility: The two components related to SSI financial eligibility are:

  1. Income: To measure your income, SSA adds your federal benefit rate and Maryland’s supplementary SSI benefits, then subtracts your first $20 of unearned income. For 2020, the federal rate is $783 for individuals and $1,175 for married couples.
  2. Resources: You must have less than $2,000 in assets to qualify for SSI, or $3,000 for married spouses. Some of your assets are excluded from this amount, such designated amounts for a home or car.

Trusts and SSI Benefits: A trust is a legal structure in which a person appoints a trustee to manage property and other assets on behalf of a beneficiary. In a revocable trust where you maintain some control over management, the entire trust value is counted as resources. Even in an irrevocable trust, certain assets could be calculated under #2 above if you could receive payments. Therefore, creating a standard trust from money you receive through an inheritance or lawsuit could disqualify you for SSI benefits.

However, there are exceptions under SSA rules. You may still be eligible for benefits through creation of one of the following types of trusts:

  • Self-Settled Special Needs Trust: This trust is funded with your own assets and you can take distributions during your lifetime. At death, the proceeds are applied to pay back the State of Maryland for what it spent on your behalf.
  • Third Party Special Needs Trust: The assets held in this trust do not belong to the disabled individual, but are placed by someone else – often a relative who funds the trust through a will.
  • Pooled-Assets Trust: With this arrangement, assets are managed by a non-profit company that pools the funds of multiple participants into a single trust.

Reach Out to a Maryland SSI Disability Attorney Regarding Your Options 

This general overview of trusts in the context of SSI benefits may be helpful, but it’s critical to stay in compliance with SSA rules when creating one. Plus, there are additional legal requirements when it comes to drafting the essential documents. For more information on special needs trusts and other structures that help you maximize your SSI benefits, please contact the Maryland Social Security disability lawyers at the Law Offices of Steinhardt, Siskind and Lieberman, LLC. We can schedule a free consultation.

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