New Changes to the S.S.I. Rules
At the end of 1999 Congress adopted the "Foster Care Independence Act
of 1999." The President is expected to sign it into law. This bill included two
important provisions affecting SSI recipients.
Transfer of assets will effect eligibility for SSI (as had been
the rule prior to 1988). There will be a 36 month look-back, similar to
Medicaid, and a penalty period calculated by dividing the amount transferred by
the SSI rate (including the state supplement). Unlike Medicaid there is a 36
month "cap" on any penalty. The penalty begins on the first day of the month
"in or after" the transfer occurred. This provision applies from the date of
enactment (when signed by the president).
Both revocable and irrevocable trusts will be considered
resources if they are "self settled," that is, they contain the assets of
an individual or an individuals spouse (unless funded by the spouse's will).
The trust will be counted as a resource if it is revocable or in the case of an
irrevocable trust if there are any circumstances (that is, "discretion") where
the trustee can pay corpus to or for the benefit of the grantor or the
grantor's spouse. There are exceptions for supplemental needs trusts
established pursuant to 42 U.S.C. §1396p(d)(4)(A) [pay-back trusts] or
(d)(4)(C) [pooled trusts]. This provision becomes effective on or after January
1, 2000.
Last Revision : December 12 1999 by
David Goldfarb
e-mail David Goldfarb goldfarb@seniorlaw.com