Improving Access to Clinical Trials Act

Flatlander · Joined: 11 Nov 2008 Posts: 135

I am assuming that the SSA will honor a contract between parents and child, that the child must pay X amount of dollars a month in rent. Child lives in parents home, is over 18 years old. I was planning on using a form from one of the manuals.

Thoughts?

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anonymouse · Guest

Renting from a parent or child has additional ramifications. Not only must they both state that they are maintaining separate households, they must also be eating all their meals separately, sharing only condiments. Unless they are paying a flat fee for food and shelter.
The parent/landlord must state what the rent is, and what they would charge anyone else for the same room.
Whatever the difference is, amounts to support to the claimant. The forms will most likely not cover everything that needs to be covered.
If they are "renting" a room for a ridiculous low amount in a high end neighborhood, then the forms may not be honored.
If the rent appears reasonable, in an average neighborhood, they may not have a problem.

DScarborough · Joined: 02 Jun 2004 Posts: 112 Location: Austin, Texas

Under Social Security program rules, when a child reaches age 18 he or she becomes an adult for Social Security purposes. This is significant because eligibility for an adult SSA is required to consider only the available income from the young adult. Consequently, the deeming of parental income legally ends when the disabled child becomes an adult. If a young adult with severe impairments continues to live with his or her parents in their home, because there are no other living alternatives, then he or she can under long-existing Social Security Administration rules pay for their fair-share of household expenses from their SSI eligibility.

Under current SSA rules, if a family of a young adult with severe disabilities provides any food and shelter then that support is counted as a form of unearned income(called in-kind support) for SSI eligibility purposes. That unearned income is then given a value and that economic value likewise will reduce the dollar amount of any SSI eligibility. Providing in-kind support is a choice that an individual's family should be able to make given that family's financial situation. If the family does not have the income to provide for in-kind support for their child, then the young adult should rightly rely on SSI income payments for support. There is no reason that SSA should assume that a family has money they do not have BUT they do. I find in my work that no matter what the economic status of the family the Social Security Administration makes a presumptive assumption that families contribute in-kind support to the young adult with a lifelong disability that lives with their family. In fact, my studies have shown that the poorer the family the less likelihood that their adult child will get the full $672 a month in support. The bottom line is when this happens their SSI check is cut by 30%. Most people never know what has hit them.

Development of a contract to show that the individual pays their fair share of room and board from their SSI is extremely important otherwise the young adult will always get 2/3 of an SSI check. It's an unwritten policy at SSA. Almost every family I meet with an adult son/ daughter living at home on SSI gets only 2/3 of an SSI check. In fact , I can truthfully say that I could do nothing but help people with issues and have a thriving practice. It's one of dirty little secrets of SSA under the Bush Administration and one Astrue needs to correct the misguided policy.

MikeWalters · Joined: 13 May 2004 Posts: 1315 Location: Cincinnati OH

I agree with Daniel that this is an area in which SSA rarely follows their own rules. There seems to be a short-hand presumption that any SSI applicant who lives with others is receiving in-kind support, and unless the claimant raises the issue, SSA will not even consider the possibility that there is an expectation that the free rent will be repaid if the claim is approved. I also wonder whether ISM is one of those issues that actually costs more money to administer than it saves.

For what it's worth, linked is the POMS explaining the procedure that SSA is supposed to follow in these situations:

https://secure.ssa.gov/apps10/poms.nsf/lnx/0500835482

DScarborough · Joined: 02 Jun 2004 Posts: 112 Location: Austin, Texas

Mike's right, but you have to know what and how to bring it up. How a family learns about those rules and how they are treated when they try to access SSI through those rules is problematic in an denial-oriented agency like the Social Security Administration. For the most part eligibility for SSI payment amount is "determined" by oral interviews at the local SSA field office level. Families are not equipped to "negotiate" with SSA claims reps with an agenda of reducing the SSI payment amount.

I think what this does for poor families is causes them to pay for food a shelter twice: once when they actually pay for the food and shelter and once again when when the inappropriate in-kind income is deducted from the assistance they truly need. Often SSI and the Medicaid eligibility is simply eliminated altogether because the SSI threshold may be recalculated further by other income such as child support or the individuals earnings through rehabilitation efforts. This clearly is not the legislative intent of the Supplemental Security Income (SSI) program. It is downright wrong. It may seem small in terms of actual cash benefits, but the opportunity costs are immense for the long term well-being of children with severe disabilities.

It is a mess that can be fixed easily. I maintain that it was a policy of the Bush Administration(continued by Astrue) to flim-flam families and save 30% of SSI payments to adults who continue to live at home with their parents. The problem is it shortchanges young adults when they need help the most. It needs to change.What insures is that many of these young folks will be on SSI the rest of thier life. How smart is that. I notice it most of all when I try to write a PASS for someone for rehabilitation efforts and have only 2/3 of the resources to work with because their SSI eligibility has been deducted because of the inappropriate application 1/3 exclusion.

Daniel

anonymouse · Guest

There were no changes in these rules under Bush. There was no particular emphasis or influence put out under Bush to follow any trend in using these rules.

I find that most of my coworkers help people get the full rate when it is obvious that the family is not well off. Sometimes it's easliy done, if the mortgage or rent is a reasonable amount, and there are several people in the house. Most of my coworkers ask the right questions about sharing expenses and make their decision based on the answers provided. Most of the time the answers people give do not fit into the boxes we are supposed to check off. People do not live according to POMS. We have to decide which POMS reference most closely matches their situation.

Other times it's not possible, like the Dr in a ritzy neighborhood with a mortgage payment of $6000.00 a month, he's not going to convince an SSA worker that he's renting a room for 500.00 a month to his immediate relative at fair market value. But they will try. Yes, I know that's not common, but it did happen. Or a man with a mortgage payment of $2200.00 a month, permitting a relative with no income to live with him, when he finds out that relative has been approved for SSI, says he expects the SSI person to turn over the entire retroactive check to him, despite the initial allegation that there was no agreement about expenses beforehand.

Rental agreements are usually brought up by the claimants, not by SSA interviewers, because per POMS, a rental agreement is supposed to be a business arrangement where everything is separate, and if the rent is not paid for any reason, they move out. Most 18 year olds do not have true rental agreements with their families, although they might start sharing expenses after the SSI starts coming.

There is an explanation of support in the initial award letter. They should read it, or have someone literate read it for them. Many do, and come back to SSA after the initial notice to report sharing expenses.

SSA is not supposed to assume that a person who has not ever paid any part of the household expenses will start doing so when they get their benefits. SSA is not supposed to predict what people will start doing with their checks when they arrive.

Each family makes their own decisions. If an 18 year old benefits from the parents private health insurance because they are considered a dependent, and then they claim to be independent under SSI rules, the parents are no longer entitled to claim that individual as a dependent on their tax return and the private insurance will be lost, because the 18 year old is no longer a dependent. For some disabled individuals, that's far more important than the difference between $424.00 and $674.00. Would you take your disabled 18 year old off your private insurance and leave them subject to Medicaid only? That would depend on the individuals need for medical services.

Quit trying to demonize SSA staff over an issue that is more complicated once you consider all the aspects of the issue. Lobby congress to eliminate different living arrangements and pay all SSI claimants the same, whether they get support or not. Some people do get support, and some don't, would you consider that fair?

jayteef · Joined: 21 Jun 2009 Posts: 270

I am interested in finding out the law on this. Though I know it seems to be a common assumption, that you can't be a dependent of someone for taxes if you are drawing full SSI - I don't quite follow the reasoning. SSI has rules for what counts as ISM and when reductions are made - but those rules are only for the SSI program, and have nothing to do with the IRS that I am aware of. The IRS has its own rules about who you can claim as a dependent. I don't see why you would be precluded from claiming your child as a dependent if you provide over half of their total support if the child is on SSI, any more than you would be precluded from claiming them as a dependent if they had the same income from non-SSI sources (i.e. employment, Social Security, etc.)

If the SSI beneficiary has rental liability (and separate consumption of food) OR pays their "fair share" of combined food and shelter costs, or lives in a "Public Assistance Household" etc. - then the reduction rule does not apply - but this is not an IRS ruling, it is an SSI determination that applies to SSI. And it only covers food and shelter costs.

Many humans (including humans on SSI) have many other general living expenses that would count as support under IRS rules that are not counted as "countable" unearned income or ISM for SSI. There is no law (that I know of) that says SSI recipients are only allowed to have food, shelter, and medical care. Though SSI only counts food and shelter provided by others "against" the SSI payments, and doesn't count many of those other expenses - that doesn't mean that the wide range of OTHER things parents provide for their children would not count as support for other programs and for the IRS.

To my knowledge, SSI doesn't actually determine the child to be "dependent" or "independent." SSI merely applies the POMS standards to determine ISM and countable unearned income for SSI purposes. Other programs have different rules.

rbourne3 · Joined: 14 May 2004 Posts: 154 Location: North Florida

Guest · Posted: Mon Jun 22, 2009 05:32 pm Post subject: Re: SSI and the 1/3 exclusion

I agree that other money given to the child counts as unearned income and would reduce the SSI check. However many items / services / expenses / etc. paid for directly by the parent do not count as unearned income.

Granted, if a person purchased their child a $5000 car, and the car could not be excluded per SI 01130.200D.1, then part of the value of the car (the amount that exceeds $4,500) per SI 01130.200D.2. So, as $500 could be counted as a resource, that $500 would count as income in the month it was received.

However, the parent would have other options, such as buying their child a car with a value of $4,500 or less.

It is certainly an advantage if parents of Adult Disabled Children are aware of many of the rules and regulations about unearned income and ISM. And I agree that there are some decisions parents can make that would result in countable income or resources for SSI. The more the parent knows about the rules, the less likely the parent will be to make choices that put the child at a disadvantage (such as giving them cash, instead of paying for things directly.)

However, I still maintain that a child can receive full SSI AND be claimed as a dependent on the parent's income taxes.

If a child is receiving SSA (on a deceased, disabled, or retired parent), no one says the parent cannot claim the child as a dependent on their taxes because those funds were used for food and shelter costs. So I think the assumption that a parent cannot claim their child who is receiving SSI as a dependent on their taxes unless they make decisions that result in the reduction of SSI is misguided.

David Traver · Posted: Tue Jun 23, 2009 03:57 am Post subject:

Hi jayteef. Welcome to Connect!

You don't need to increase the font size so everybody can read it. Just hold down the CTRL button and zoom in and out with your mouse wheel.

Thanks!

Guest · Posted: Tue Jun 23, 2009 03:09 pm Post subject:

Thanks! I didn't know I could do that. It sure makes things easier! :)

jayteef · Joined: 21 Jun 2009 Posts: 270

If this law is up to date, The Seventh Circuit (Illinois, Indiana, and Wisconsin) has different standards for what constitutes a business arrangement. It is not based on market value. As long as the child pays the PMV or more, a business arrangement exists. If they pay less than the PMV, the difference between what they pay and PMV is considered ISM.

http://www.ssa.gov/OP_Home/cfr20/416/416-1130.htm
In-Kind Support and Maintenance §416.1130 Introduction

(b) How we define in-kind support and maintenance. In-kind support and maintenance means any food or shelter that is given to you or that you receive because someone else pays for it. Shelter includes room, rent, mortgage payments, real property taxes, heating fuel, gas, electricity, water, sewerage, and garbage collection services. You are not receiving in-kind support and maintenance in the form of room or rent if you are paying the amount charged under a business arrangement. A business arrangement exists when the amount of monthly rent required to be paid equals the current market rental value (see §416.1101). Exception: In the States in the Seventh Circuit (Illinois, Indiana, and Wisconsin), a business arrangement exists when the amount of monthly rent required to be paid equals or exceeds the presumed maximum value described in §416.1140(a)(1). In those States, if the required amount of rent is less than the presumed maximum value, we will impute as in-kind support and maintenance, the difference between the required amount of rent and either the presumed maximum value or the current market value, whichever is less.