Here at Silver & Silver, your Social Security Lawyers that serve clients in Montgomery County, PA, and the surrounding areas, we handle cases and consult clients about every imaginable aspect of Social Security law. In this article, we’d like to share a recent consultation that didn’t go the client’s way to shed light on the Do’s and Don’ts of selling your home while receiving Supplemental Security Income (SSI) benefits.
SSI is available to disabled adults and children who need income assistance or to citizens over the age of 65 with less than $2,000 in the bank, ($3000 if married).
Knowing how to manage additional income, such as the proceeds of selling a home, is crucial to maintaining SSI benefits.
We answered a letter in early January regarding this topic, from someone who sold a home and was later informed by Social Security that their SSI benefits were being discontinued. We researched the case and found that the seller did not comply with the proper procedure.
Here’s what you need to know if you receive SSI and want to sell your home:
- After the sale, you have three months to buy a new home.
- If, in that three month period, you buy a new house and have less than $2,000 in the bank, you will retain your SSI benefits.
- If, in that three month period, you fail to buy a new house, the money you made off the sale (anything that bumps your bank account over $2,000/$3,000) will negate your SSI eligibility for each month that your assets exceed the amount permitted.
- In order to reinstate your SSI benefits, it will be necessary for you to “spend down,” the funds in excess of $2000/$3000 which we covered in another recent blog post on our site, will be necessary until you have no more than $2,000. Social Security will require a record of what was purchased with the proceeds of your home.
- You typically have 12 months in which to “Spend Down” funds and apply for reinstatement. Transferring money to a family member is not allowed. If you do not sufficiently allocate funds within those 12 months, you may have to start the SSI application process from scratch.
As you can see, complying with Social Security law can be a complicated task. It’s especially stressful if you’re handling a major life event, such as selling a home. It’s important to consult a legal team you can trust to help you dot all the ‘i’s’ and cross all the ‘t’s’.