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SSI and Personal Injury Awards

What happens to my SSI if I get personal injury awards?

If you have been injured from the negligence of another person you may be entitled to personal injury awards, but what if you are currently receiving Supplemental Security Income (SSI)? There are very specific rules about receiving cash gifts and personal injury awards if you are getting SSI benefits, and you will need to understand how this can affect your SSI monthly payments BEFORE you accept any type of award or settlement.

The first consideration is whether the payment amount is likely to raise your “resources” above the allowable limit for SSI benefits. If you are receiving SSI (Title XVI Supplemental Security Income) then your settlement can offset your SSI and the amount of resources which is currently allowedis $2,000 as an individual and ($3,000 if you are married).
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What does the Social Security Administration consider a resource?


The SSA monitors all additional income and resources that SSI claimants receive, including unearned income. According to the SSA the following is considered unearned income:

  1. The value of food or shelter that someone gives you, or the amount of money they give you to help pay for them

  2. Department of Veterans Affairs (VA) benefits;

  3. Railroad retirement and railroad unemployment benefits;

  4. Annuities, pensions from any government or private source, workers' compensation, unemployment insurance benefits, black lung benefits and Social Security benefits;

  5. Prizes, lottery winnings, settlements and awards, including court-ordered awards;

  6. Proceeds of life insurance policies;

  7. Gifts and contributions;

  8. Support and alimony payments;

  9. Inheritances in cash or property;

  10. Rental income; and

  11. Strike pay and other benefits from unions.

Now, you may be considering hiding the resource or money, hoping the SSA does not notice. First, this is against the law and can be considered fraud. Additionally, if the SSA does find out they are legally allowed to charge you an overpayment and you will be required to repay the money back to the SSA.

What are my options?


The good news for SSI claimants is there may be a way that they can keep the personal injury settlement and their Supplemental Security Income payments, but it will take some work. Claimants may, under certain conditions, be allowed to establish a Special Needs Trust.

The Special Needs Trust can be created as part of the Last Will and Testament or it can be created by itself, allowing the disabled individual to have funds held in a trust for their benefit.

Basically, the goal of the Special Needs Trusts is to provide "supplemental and extra care over and above what the government provides."  Most disabled SSI recipients who are getting SSI will be able to use some of their Special Needs Trusts to supplement their monthly SSI benefits, although there are restrictions and the trust can only be accessed for very specific purposes which should be discussed with a lawyer.

Talk to a lawyer about how to create the Special Needs Trust so that you can keep your personal injury award. If your special needs trust is set up properly, the funds in the trust may not be considered “countable” by the government, allowing you to have more than the allowable $2,000 in countable resources.

What’s the bottom line?


SSI is for claimants who have VERY limited income and resources and any type of cash award or personal injury settlement (which causes their resource level to rise too high) may eliminate the claimant’s right to receive SSI payments and potentially Medicaid as well. The good news is there may be options for the claimant. Talk to an estate planning lawyer or personal injury attorney for more information.


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