One of the most frustrating things for a family with a loved one with special needs is losing some of that individual’s benefits after working so hard to qualify to receive them. In many cases beneficiaries receiving Supplemental Security Income, also known as SSI, can lose up to one third of their income from the government if they receive things for free from other people. This type of loss, is known as a reduction due to the receipt of in kind support and maintenance. In kind support and maintenance is commonly referred to as ISM.

In 2024, new legislation will diminish the losses due to ISM. Effective September 30^th, 2024, the Social Security Administration will be using new rules to evaluate if a SSI recipient will lose some of their support. Food, provided by others, will no longer be included in the ISM calculation.  Currently, food provided by others causes a Dollar for Dollar reduction in SSI benefits up to 1/3 of the entire SSI benefit amount.

The other significant change coming at the end of September will be how the Social Security Administration handles housing support. Currently there are only seven states, including Illinois and Wisconsin where Oak Wealth Advisors has offices, that do not reduce SSI benefits if rent is being paid that is at least as much as 1/3 of the SSI benefit. This amount is approximately $350. At the start of October 2024, all states will adopt this approach in evaluating if sufficient rent is being charged. Prior to this change going into effect, in many states, the Social Security Administration requires rent to be equal to the fair market value of the space in order to avoid an SSI reduction. In some communities, the fair market value may be thousands of dollars per month.

By changing the rule for how much rent must be charged to the individual living at home or how much rent must be paid to a special needs trust that owns the residence, the Social Security Administration is relieving a burden on families and making the ISM rule related to housing easier to understand.

We believe that this change is going to make it easier for more families to charge appropriate rent allowing their loved one to keep their entire SSI benefit every month. These rule changes should allow families to support their loved ones with greater administrative ease.

If you have questions about how rent payments impact your loved one’s benefits, please reach out to Oak Wealth Advisors or your special needs attorney for more information.