SSI Pitfall for the Unwary
Beware, A Sneaky (But Avoidable) Way to Get Stuck With An SSI Overpayment
Don’t be stuck with an SSI Overpayment Debt! For Representative Payees of SSI recipients (not SSDIB or SS RIB), and even SSI recipients themselves: when you are being careful to keep income and resources under the limits, note that being over the resource limit in any given month for even a moment, will be a disqualifier for ANY SSI moneys that month. And, this overage can cause an overpayment of massive proportions. Here is a recent incident that came my way via pro bono consult time: Mom is Representative Payee for disabled son – she cares for the monthly SSI payment to her adult disabled child. He gets $733/mo. That is income from SSI. He has no other income. He has about $1400 in savings, however, from an inheritance some time ago that his mom is preserving for him. So, every month, he has $1400 in countable resources and then, at some point early in the month, $733 pops in to his account and within a few days is used to pay his rent, cell phone, utilities, etc., such that it is all gone very quickly and he is back to $1400 in countable resources. Here is the kicker: On day 1, he has $1400. On day 3, when his SSI gets deposited, he has $2133. This is OVER the limit of $2000 for a single person. Two days later, day 5, he is back down to $1400 for the rest of the month. His mom, reasonably but incorrectly, thought that since the money pops back down immediately it is not really a resource and wouldn’t count, since it is gone so fast. It doesn’t matter! For any month where he has resources over $2000, at any point, he is not qualified for that incoming SSI check. Turns out, he now had an overpayment of about 3 years times $733/month = $26,388. What his mom should have done is reduce his savings of $1400 to something less than $1267 so that at no time would his monthly SSI income put him over the $2000 resource limit. That mere $133 overage per month (but just one ownership of 1 $133 resource, that just remained each month) has now cost him $26,388. Don’t let this happen to you! Note also that the $2000 limit has not changed in all the years I have been exclusively practicing SS, I don't believe. However, the SSI benedfit rate HAS increased, usually annual, with a COLA. SO that savings amount will have to be reduced each year that the SSI benefit rate goes up, to avoid the overpayment.