The Supplemental Security Income program through the Social Security Administration has guidelines that must be met to qualify for benefits. Limits on the financial resources available to you are among the eligibility guidelines, but you may own a home and receive SSI provided it is your principal place of residence.
Federal regulations about home exclusion must be strictly complied with to avoid a loss of benefits. This is particularly true should you decide to sell your home. The following information, along with a consultation with an SSI attorney, will enhance your understanding of homeownership and protecting your SSI benefits.
What is SSI?
SSI provides monthly payments to people with limited income and financial resources who are 65 years of age or older and to people of any age, including children, who are disabled or blind. Because it is not funded through Social Security taxes collected from employment earnings, you may qualify for SSI benefits regardless of your work history, which is unlike Social Security disability insurance that requires a minimum period of employment or self-employment to qualify for benefits.
How to get SSI benefits?
In addition to being blind, disabled, or 65 years of age or older, you must be a citizen of the United States, have permanent residence status, or be an alien covered by one of the other categories for SSI eligibility. You also cannot have resources exceeding $2,000 as an individual or $3,000 as a couple.
Resources include the following:
- Deposit accounts at banks and other financial institutions.
- Real property.
- Motor vehicles.
- Life insurance with a cash value.
- Personal property.
SSI treats anything that can be used to purchase shelter and food as a resource. For example, if a friend or family member allows you to live in their home without charging rent, its value is treated as a resource. However, some resources do not count toward the SSI limits, including a home you live in as your principal residence and the land on which it is built.
When is a home not counted as a resource for SSI?
The home that you and your spouse live in is not counted as a resource regardless of its value if you have an ownership interest, and it is your principal place of residence. If you leave the home without intending to return, it becomes a countable resource unless you leave your home to live in an institution. However, the home continues to be an excluded resource if your spouse or another dependent relative, such as a child, continues to occupy it.
If domestic violence forces you to flee from your home, it remains your principal residence for purposes of SSI regardless of whether you intend to return to it. It continues as your home until you establish a new residence elsewhere.
Selling a principal residence while on SSI
You can sell your home without having its value affect your eligibility for SSI benefits provided you comply with federal regulations. An SSI lawyer can be an excellent resource for legal advice and guidance in structuring and handling the sale and the proceeds from it to avoid the loss of SSI benefits.
The general rule is that money received on the sale of a home excluded from countable resources as a principal residence continues to be excluded for up to three months. You must use the proceeds from the sale, or at least enough of it to remain at or below the $2,000 resource limit for an individual and $3,000 for a couple, to purchase another home for use as a principal residence.
During the three months after the sale of your home, you may continue to receive SSI benefits as long as your eligibility status has not changed except for receipt of the proceeds from the sale. At the end of the three months, SSI counts the money as a resource that may affect your eligibility for benefits.
Receiving all or part of the proceeds from the sale of your home in the form of a promissory note calling for monthly payments by a buyer does not circumvent the rules about reinvestment toward a new principal residence. You still must use what you received on the sale toward the purchase of a home.
Consult with an SSI Attorney Before Selling Your Home
An SSI lawyer from the Law Office of Daniel Berger is a trusted resource you can rely upon to guide you through all matters related to SSI benefits. If you are considering the sale of a home, a consultation with an SSI attorney provides the knowledge and experience needed to ensure compliance with SSI rules and regulations. Visit our website or call us at 718-691-7475 for a free consultation.