Accidentally hurting someone feels bad, especially when you are trying to help. Unfortunately, friends and family can inadvertently harm a special needs person by giving them a monetary gift. How can this be? Because government program eligibility is easy to lose.
Government programs like Social Security Income (SSI) and Medicaid demand beneficiaries meet certain monetary restrictions to remain eligible for benefits. In fact, the SSI program requires a candidate to have less than $2,000 worth of “countable resources” to stay in the program.
The SSI program recognizes the following assets as “countable resources” toward the $2,000 limit:
- Bank accounts
- Assets in a revocable trust
- Life insurance
- Personal property
- Vehicles (in excess of one vehicle that transports the beneficiary or a family member of the beneficiary)
- Deemed resources (a portion of the resources of a spouse or parent of the beneficiary)
$2,000 is a low threshold for benefit eligibility, and one gift can ruin a loved one’s benefits. Fortunately, someone can give a gift to a special needs person without affecting his or her benefits.
The following accounts/processes can be used to work around benefit eligibility:
- Special needs trusts
- ABLE Accounts
As the grantor (the person that funds the trust), you can create a special needs trust for your loved one, allowing you to transfer money to their trust account without affecting his or her benefit eligibility. If your loved one has an ABLE account, you can deposit money into their account without affecting his or her benefit eligibility.
However, both options have their pros and cons and can be challenging to set up on your own, so you should seek out an experienced estate planning attorney to walk you through the process.
Scheduling a consultation with us is easy. Call us at (215) 631-8432 or fill out the form below and we will get back to you as soon as possible.
Whether you want to avoid potential probate or you are struggling with the probate process, the attorneys at Chestnut Hill Legal can assist you. Our lawyer for probate can help you determine your best options to protect your assets from probate, fulfill all off your duties if you are named as an executor of an estate, or understand your rights as an heir or beneficiary under Pennsylvania state law.
The information on this website is for general information purposes only. Nothing on this site should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute, an attorney-client relationship.
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