Supplemental Security Income
Supplemental Security Income (SSI) is a United States government program that provides stipends to low-income people who are either aged 65 or older, blind, or disabled.Although administered by the Social Security Administration, SSI is funded from the U.S. Treasury general funds,not the Social Security trust fund. SSI was created in 1974 to replace federal-state adult assistance programs that served the same purpose. The restructuring of these programs was intended to standardize the eligibility requirements and level of benefits.The new federal program was incorporated into Title XVI (Title 16) of the Social Security Act.Today the program provides benefits to approximately eight million Americans.
The legislation creating the program was a result of President Richard Nixon's effort to reform the nation's welfare programs. At that time, each state had similar programs under the Aid to the Blind, Aid to the Permanently and Totally Disabled, and Aid to the Elderly. The Nixon Administration thought these programs should be federalized and run by the Social Security Administration. Thus, SSI was created to eliminate the differences between the states including different disability standards and income and resources requirements, which many perceived as irrational or unfair. President Nixon signed the Social Security Amendments of 1972 on October 30, 1972 which created the SSI Program. The SSI program officially began operations in January 1974 by federalizing states' programs, designating the Social Security Administration (SSA) to administer the SSI program. SSA was selected because it had been administering a nationwide disability program under the Social Security Disability Insurance Benefits (DIB) program since 1956 under the Old Age, Survivors, and Disability Insurance (OASDI) programs associated with Federal Insurance Contributions Act (FICA) payroll taxes.
In order to be eligible to receive SSI benefits, individuals must prove the following:
They are 65+ years of age or blind or disabled.
and
They legally reside in one of the 50 states, the District of Columbia, Northern Mariana Islands, or are the child of military parent(s) assigned to permanent duty outside of the US, or are a student (certain restrictions apply) temporarily abroad.
and
They have income and resources within certain limits (see subsections).
and
They have applied for the benefits.
An individual may be ineligible if he or she is a resident of a public institution from the first day of a month through the last day of the same month,[6] fails to apply for all other benefits for which they may be eligible (including Social Security benefits), has an unsatisfied warrant or violates parole conditions, fails to give SSA permission to contact any financial institution for financial records, or is outside the US for 30 consecutive days (with some exclusions). Numerous restrictions have been placed on who is eligible for the benefit, which is considered a welfare benefit. However, unlike social security benefits (Title II), earned work credits are not a requirement for SSI.
If insured for disability and not currently receiving benefits, an applicant for SSI also applies for Social Security Disability Insurance Benefits (DIB), and the standard by which applicants are judged to be disabled is virtually the same for both SSI and DIB
The decision as to whether an individual is disabled is made by the various state Disability Determination Services (DDS), which contract with the federal government to make such determinations. Although the DDS's are state agencies, they follow federal rules. This arrangement arose from the inception of OASDI, when some key members of Congress considered the Social Security Disability program should be administered employing federalism, fearing expansion of the federal government.
Aged, disabled, or blind[edit]
In order to be eligible for SSI, a person must meet the definition of being aged, disabled, or blind.
Aged - Being deemed aged consists of attaining the age of 65 or older.The Social Security Administration, like the United States Government in general, follows English common law and considers a person to attain an age the day before their birthday.
Disabled - Being deemed disabled consists of meeting the general disability definition used by the Social Security Administration:
"Disability means inability to engage in any SGA [substantial gainful activity] by reason of any medically determinable physical or mental impairment which can be expected to result in death, or has lasted or can be expected to last for a continuous period of not less than 12 months."
"The 1967 amendments specified that workers shall be determined to be under a disability only if the physical or mental impairment or impairments are of such severity that the individual is not only unable to do his previous work but cannot, considering his age, education, and work experience, engage in any other kind of substantial gainful work which exists in the national economy. This is regardless of whether any of these are true:
Such work exists in the immediate area in which the claimant lives.
A specific job vacancy exists.
The claimant would be hired if they applied for work.
"The statute also specifies that 'work which exists in the national economy means work which exists in significant numbers either in the region where such individuals lives or in several regions of the country.'"
Substantial gainful activity (SGA), for the year 2015, is the ability to earn $1,090 gross income in a month's period for most disabled individuals, and $1,820 for those whose disability includes blindness.
In addition, children under the age of 18 can be determined to be disabled for SSI purposes "if the individual has a medically determinable impairment or combination of impairments that causes marked or severe functional limitation(s), and can be expected to result in death, or has lasted or can be expected to last for a continuous period of not less than 12 months."
Blind - Being deemed blind consists of meeting the following definition:
"central visual acuity of 20/200 or less in the better eye with the use of a correcting lens. An eye which has a limitation in the field of vision such that the widest diameter of the visual field subtends an angle no greater than 20 degrees should also be considered as having a central visual acuity of 20/200 or less."
In addition, for SSI purposes, an individual is considered blind regardless of the period of time they are expected to be blind or if they are performing substantial gainful activity.
Income
One of the requirements to receive SSI is that the individual's income must be below certain limits. These limits may vary based on the state in which the individual lives, his/her living arrangement, the number of people living in the residence, and the type of income. The limit varies on all of these factors and is described below, in the section on benefit computation.
Resources
Another requirement for SSI is that the individual's resources be below a certain limit. This amount is $2,000 for a single individual and $3,000 for an individual and their spouse (whether the spouse is eligible for SSI or not), $4,000 for a child applicant with one parent living in the household, and $5,000 for a child applicant with two parents living in the household. However, conditional benefits may be paid if a substantial portion of the resources are considered non-liquid, resources that cannot be sold within 20 working days,if they agree to sell the resources at their current market value within a specified period and repay the money after the non-liquid property is sold.
However, not all actual resources are counted in calculating an individual's or couple's resources for SSI purposes
The resource limits were originally set at $1,500 for an individual and $2,500 for couples in 1974,and were not linked to inflation. In 1987 the limits were raised to $1,800/$2,700, in 1988 to $1,900/$2,850 and in 1989 to $2,000/$3,000. Under current law they will remain at present levels indefinitely.
There will soon be one exception to the general asset limit. On December 19, 2014, the ABLE Act of 2014 (standing for Achieving a Better Life Experience Act) was signed into law, creating a new tax-advantaged account under the newly added Section 529A of the Internal Revenue Code.Details of the new ABLE accounts, which will officially come into effect once the Treasury Department issues enabling regulations and states pass legislation regarding account administration, are:
Accounts can be established by, or on behalf of, a disabled person, provided that the beneficiary's disability began before age 26.
Annual contributions to an account are limited to the same amount as the gift tax exclusion for an individual ($14,000 in 2014). The upper limit for lifetime contributions is the same as that for a 529 educational plan in the disabled person's state of residence. Contributions are not tax-deductible, but income earned in an account is not subject to tax.
Tax-free withdrawals can be made for "qualified disability expenses", including but not limited to education, housing, transportation, employment-related expenses, assistive technology, and health care.
There are special statutory rules regarding the accumulation of ABLE account assets for individuals on SSI and Medicaid. The first $100,000 in an ABLE account is not counted as an asset for purposes of SSI eligibility. Once an ABLE account balance exceeds $100,000, the beneficiary's SSI payments are suspended until the account balance drops below $100,000. However, the beneficiary remains covered by Medicaid regardless of the account balance.
The legislation creating the program was a result of President Richard Nixon's effort to reform the nation's welfare programs. At that time, each state had similar programs under the Aid to the Blind, Aid to the Permanently and Totally Disabled, and Aid to the Elderly. The Nixon Administration thought these programs should be federalized and run by the Social Security Administration. Thus, SSI was created to eliminate the differences between the states including different disability standards and income and resources requirements, which many perceived as irrational or unfair. President Nixon signed the Social Security Amendments of 1972 on October 30, 1972 which created the SSI Program. The SSI program officially began operations in January 1974 by federalizing states' programs, designating the Social Security Administration (SSA) to administer the SSI program. SSA was selected because it had been administering a nationwide disability program under the Social Security Disability Insurance Benefits (DIB) program since 1956 under the Old Age, Survivors, and Disability Insurance (OASDI) programs associated with Federal Insurance Contributions Act (FICA) payroll taxes.
In order to be eligible to receive SSI benefits, individuals must prove the following:
They are 65+ years of age or blind or disabled.
and
They legally reside in one of the 50 states, the District of Columbia, Northern Mariana Islands, or are the child of military parent(s) assigned to permanent duty outside of the US, or are a student (certain restrictions apply) temporarily abroad.
and
They have income and resources within certain limits (see subsections).
and
They have applied for the benefits.
An individual may be ineligible if he or she is a resident of a public institution from the first day of a month through the last day of the same month,[6] fails to apply for all other benefits for which they may be eligible (including Social Security benefits), has an unsatisfied warrant or violates parole conditions, fails to give SSA permission to contact any financial institution for financial records, or is outside the US for 30 consecutive days (with some exclusions). Numerous restrictions have been placed on who is eligible for the benefit, which is considered a welfare benefit. However, unlike social security benefits (Title II), earned work credits are not a requirement for SSI.
If insured for disability and not currently receiving benefits, an applicant for SSI also applies for Social Security Disability Insurance Benefits (DIB), and the standard by which applicants are judged to be disabled is virtually the same for both SSI and DIB
The decision as to whether an individual is disabled is made by the various state Disability Determination Services (DDS), which contract with the federal government to make such determinations. Although the DDS's are state agencies, they follow federal rules. This arrangement arose from the inception of OASDI, when some key members of Congress considered the Social Security Disability program should be administered employing federalism, fearing expansion of the federal government.
Aged, disabled, or blind[edit]
In order to be eligible for SSI, a person must meet the definition of being aged, disabled, or blind.
Aged - Being deemed aged consists of attaining the age of 65 or older.The Social Security Administration, like the United States Government in general, follows English common law and considers a person to attain an age the day before their birthday.
Disabled - Being deemed disabled consists of meeting the general disability definition used by the Social Security Administration:
"Disability means inability to engage in any SGA [substantial gainful activity] by reason of any medically determinable physical or mental impairment which can be expected to result in death, or has lasted or can be expected to last for a continuous period of not less than 12 months."
"The 1967 amendments specified that workers shall be determined to be under a disability only if the physical or mental impairment or impairments are of such severity that the individual is not only unable to do his previous work but cannot, considering his age, education, and work experience, engage in any other kind of substantial gainful work which exists in the national economy. This is regardless of whether any of these are true:
Such work exists in the immediate area in which the claimant lives.
A specific job vacancy exists.
The claimant would be hired if they applied for work.
"The statute also specifies that 'work which exists in the national economy means work which exists in significant numbers either in the region where such individuals lives or in several regions of the country.'"
Substantial gainful activity (SGA), for the year 2015, is the ability to earn $1,090 gross income in a month's period for most disabled individuals, and $1,820 for those whose disability includes blindness.
In addition, children under the age of 18 can be determined to be disabled for SSI purposes "if the individual has a medically determinable impairment or combination of impairments that causes marked or severe functional limitation(s), and can be expected to result in death, or has lasted or can be expected to last for a continuous period of not less than 12 months."
Blind - Being deemed blind consists of meeting the following definition:
"central visual acuity of 20/200 or less in the better eye with the use of a correcting lens. An eye which has a limitation in the field of vision such that the widest diameter of the visual field subtends an angle no greater than 20 degrees should also be considered as having a central visual acuity of 20/200 or less."
In addition, for SSI purposes, an individual is considered blind regardless of the period of time they are expected to be blind or if they are performing substantial gainful activity.
Income
One of the requirements to receive SSI is that the individual's income must be below certain limits. These limits may vary based on the state in which the individual lives, his/her living arrangement, the number of people living in the residence, and the type of income. The limit varies on all of these factors and is described below, in the section on benefit computation.
Resources
Another requirement for SSI is that the individual's resources be below a certain limit. This amount is $2,000 for a single individual and $3,000 for an individual and their spouse (whether the spouse is eligible for SSI or not), $4,000 for a child applicant with one parent living in the household, and $5,000 for a child applicant with two parents living in the household. However, conditional benefits may be paid if a substantial portion of the resources are considered non-liquid, resources that cannot be sold within 20 working days,if they agree to sell the resources at their current market value within a specified period and repay the money after the non-liquid property is sold.
However, not all actual resources are counted in calculating an individual's or couple's resources for SSI purposes
The resource limits were originally set at $1,500 for an individual and $2,500 for couples in 1974,and were not linked to inflation. In 1987 the limits were raised to $1,800/$2,700, in 1988 to $1,900/$2,850 and in 1989 to $2,000/$3,000. Under current law they will remain at present levels indefinitely.
There will soon be one exception to the general asset limit. On December 19, 2014, the ABLE Act of 2014 (standing for Achieving a Better Life Experience Act) was signed into law, creating a new tax-advantaged account under the newly added Section 529A of the Internal Revenue Code.Details of the new ABLE accounts, which will officially come into effect once the Treasury Department issues enabling regulations and states pass legislation regarding account administration, are:
Accounts can be established by, or on behalf of, a disabled person, provided that the beneficiary's disability began before age 26.
Annual contributions to an account are limited to the same amount as the gift tax exclusion for an individual ($14,000 in 2014). The upper limit for lifetime contributions is the same as that for a 529 educational plan in the disabled person's state of residence. Contributions are not tax-deductible, but income earned in an account is not subject to tax.
Tax-free withdrawals can be made for "qualified disability expenses", including but not limited to education, housing, transportation, employment-related expenses, assistive technology, and health care.
There are special statutory rules regarding the accumulation of ABLE account assets for individuals on SSI and Medicaid. The first $100,000 in an ABLE account is not counted as an asset for purposes of SSI eligibility. Once an ABLE account balance exceeds $100,000, the beneficiary's SSI payments are suspended until the account balance drops below $100,000. However, the beneficiary remains covered by Medicaid regardless of the account balance.
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