Will Receiving Gifts Impact My Social Security Disability Benefits?

 Posted on December 20, 2024 in Social Security Disability

While receiving gifts - especially monetary gifts or gifts of great value - can be a joyous occasion, people who are reliant on Social Security benefits might also worry about whether it could affect their benefits. If you receive Social Security Disability Insurance (SSDI), you have nothing to fear. SSDI benefits are entitlements based on your work history and disability status, not your current financial resources and needs. Many SSDI recipients have substantial savings or assets from before they became disabled and had to stop working. SSDI recipients do not need to report gifts or inheritances to the Social Security office. However, if you are receiving Supplemental Security Income (SSI), a substantial gift or inheritance could impact your need-based benefits. An experienced Dallas, TX SSI lawyer can help you understand how gifts and inheritances might impact your benefits.

Why Do Gifts Affect SSI But Not SSDI? 

SSDI can be thought of as a federally-backed insurance plan against disability. When you get into a car accident, your car insurance company does not try to calculate how much money you have that you could put towards repair costs - it simply pays what you are owed, which is usually a function of how much you pay monthly. Similarly, SSDI will pay your disability claim based on how long you worked and how much you paid into the system regardless of your current resources.

SSI, on the other hand, is a needs-based system. If you have the financial resources you need to get by based on substantial monetary gifts or inheritances you receive, your eligibility for SSI could be impacted.

What Kinds of Gifts Affect SSI Eligibility Status? 

Normally, only monetary gifts and inheritances need to be reported to the Social Security Administration with few exceptions. Gifts of personal items, like electronics, new clothes, games, or even a car when you did not have one before generally will not count against you. Direct monetary gifts can count against your income limits. If you have family members who normally send a check for Christmas, it may be better to have them instead take you shopping and help you pick out the things you need.

Are There Ways to Plan Gifts Without Threatening SSI Eligibility? 

If you know that you will have an inheritance coming one day and rely on SSI, there are steps your loved ones can take to help you reap the benefit of their gifts without jeopardizing your benefits. Special needs trusts are commonly used in this situation, as they can help keep your inheritance from being counted against you while still being available when you need something. Your SSI attorney should always be kept informed about any planned inheritances or gifts you are likely to receive.

Contact a Dallas, TX SSI Lawyer 

The Law Offices of Coats & Todd is committed to helping people with disabilities get and keep SSDI or SSI payments. Our experienced Dallas County, TX social security attorneys will do all we can to help you enjoy the gifts you receive from loved ones without jeopardizing your benefits. Contact us at 972-671-9922 for a complimentary consultation.