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Legal Advice

Can the Government take away your home if you are on Disability Income?

by Sophia Barkat

How safe are you today from having your property taken away by the State or Federal
government? You have no clue? Consider this: for people in the US on some form
of disability income or care provided by the State or Federal government, this fear is
real.

A reader, Chris (from Washington State) had a question on Supplemental Security
Income which prompted our investigation into the issue. Interview requests were
sent out to over 20 lawyers who specialized on Disability Insurance or Supplemental
Security Insurance. Only one responded in time for this article to be published. The
response is very useful to anyone on disability income – whether on State-provided
benefits like nursing-home care, or those on federal programs like Supplemental
Security Income -- as this group of people are at risk of losing their property to
the State or Federal Government.

The question by Chris is followed by a response from a lawyer, who wished not to be
named in this article. Hence, he will go by "Anonymous Lawyer." It should be noted
that neither I nor any writers at Juryfury.com provided this advice, and that Chris and
others are urged to talk to a lawyer before going ahead with any legal advice posted
here.

There is also an introduction to Supplemental Security Income, and an update on
the future of disability care in the US, also.

Questions & Answers

Chris (from Washington State) wrote:

"I am 54. I am not able to work anymore and receive Supplemental Security Income.
I own a home, paid in full. I want my son to get my house when I die, but the SSI is
known to claim people’s homes. Please tell me how to leave the home to my son?"

"I know a lady who is 97 and about to die. She was put in a nursing care facility and SSI
came after her and tried to take her house. She was renting so no problem. Another gal
51 died and her house was taken by the Federal Govt. and her children were kicked out,
all over 18 but still living at home. She had a WILL but the Federal Govt. ignored it saying
they were owed money for taking care of her so long. How can I avoid this?"

Anonymous Lawyer wrote:

"Normally, people on SSI don’t lose their properties to the Federal Government. States,
however, tend to claim homes etc. if the person is on some form of State-run disability
care or Income program.

"However, anyone afraid of ever losing their property should make a BENEFICIARY
DEED as soon as possible, naming your son as the beneficiary. This will allow automatic
transfer of property from you to your son. You most probably have to file it with your
County/Township. Read all papers before you sign them to make sure this is what
you want.

"Unlike a BENEFICIARY DEED, a WILL is not an automatic transfer upon death,
and it is subject to probate proceedings and creditors claims before any property
transfer. So, making a WILL won’t help you save your property if the State or
federal government or creditors interfere.

"Use a lawyer or call your County official to do this right away."

Now that we have answered Chris's question, let's explore our own. What is SSI?
Who dictates what SSI policy will be? What is the current situation on SSI and
other forms of disability income in the US?

What is SSI?

You have an illness or you become disabled and can’t find work, although you are
protected by the Equal Employment Opportunity Act. This doesn’t stop bills from
piling up. How do you go about? Is there any help in store for you? According to
the US Federal Government, you are eligible for Social Security Income and
Supplemental Security Income, respectively.

Supplemental Security Income (SSI) is a Federal income supplement program
funded by general tax revenues, not Social Security taxes. "It is designed to
help aged, blind, and disabled people, who have little or no income. And, it
provides cash to meet basic needs for food, clothing, and shelter," according
to Social Security Administration. (See link)

Conditionalities of SSI

The question, of course, is what constitutes "little or no income"?

According to the ssa.gov site, "little or no income" aka "limited income" implies
income less than $2000/yr, and resources less than $3000/yr. (See link). The
factors that can reduce the SSI amount you collect are also listed. (See link).
If one fails to report one’s current and actual financial standing – income and
resources – then the SSI might very well claim the SSI claimant’s assets to
account for the excess amount.

The Oregon State Bar Association website elaborates: "SSI requires that you have
below $2,000 in countable resources, and as a couple, below $3,000. Resources
are things you may own, including cash, stocks, bonds and so forth. However, not
all assets are countable. Your home does not count, no matter what its value.
Personal belongings, household goods, insurance policies and cars may not count
either, depending on their value and what they are used for. No matter how disabled
you may be, if the resource limit is exceeded, then resources must be used or
disposed of in a manner acceptable to SSI before you can receive SSI." ("What
are the financial eligibility requirements?" link).

It also states just how reportable income can be used against a claimant on SSI:

"The SSI "income" rules have categories of income such as earned, unearned
and in-kind. In-kind income is money for food, clothing or shelter. If you are
given these things without having to repay anyone, then SSI will reduce your
SSI monthly check by one-third. If you received a loan, instead of a gift, for food,
clothing or shelter, then there is no one-third reduction in your check. Earned
income, usually wages, is treated more favorably by SSI and reduces the SSI
monthly check one dollar for every two dollars of earned income. Income, such
as VA benefits, Social Security Disability Insurance payments, rental income,
and pension benefits reduce SSI one dollar for every dollar of unearned income
received."

So, property might be claimed by the SSA upon an SSI recipient’s death, if the
recipient earned rental income from property or earned wages in life but did not
report this to the SSA. The reason: to recover the excess SSI paid out.

Congress on SSI

The US Congress makes policies regarding SSI and all disability incomes in the US,
and lets the SSA handle the administration of such policies. As the policy-maker,
the Congressional Committte on SSA has a high impression about its policies. It views
instead, fraud by claimants as the number one problem with the system, and not
the unfair policy itself. At a 2002 Congressional Hearing on Fraud and Abuse in the
Supplemental Security Income Program, Rep. Wally Herger (R-CA) and Chairman,
Subcommittee on Human Resources, gave the following speech: (See link)

"The nation’s Supplemental Security Income program, commonly called SSI, provides
a vital safety net for our nation’s most needy disabled and elderly individuals. Thanks
to SSI, an elderly widow has the resources to stay in her own home and a parent
gets help in caring for a severely disabled child. Nearly 7 million individuals received
monthly SSI benefits totaling more than $33 billion last year. Billions more are spent
on health and other supports for SSI recipients.

"Unfortunately, there has been too much fraud and abuse in SSI, undermining public
support for a program that is critical for so many truly needy individuals. This
Subcommittee has worked diligently on a series of bills to prevent abuse and
recover misspent funds. Many hardworking individuals helped. I want to thank
the Social Security Administration, and especially the Office of the Inspector General,
along with the U.S. General Accounting Office, for their help. Working together, we
developed changes that are restoring SSI’s integrity while protecting deserving
recipients.

"Here’s one example. Back in 1994, GAO reported that, after years of rapid growth,
an estimated 250,000 Americans were getting disability checks due to drug addiction
or alcoholism. Few ever got off SSI, unless you counted the most common reason
for ending benefits – death. We were literally paying people to drink themselves to
death. So in 1996 we ended the drug addicts and alcoholics part of the program
and used some of the savings for more drug treatment, where it might help individuals
overcome their addictions. We’ve made progress on other examples of waste, fraud,
and abuse, including keeping prisoners and fugitives from collecting benefits. And in
1999 this Subcommittee passed a series of changes to better recover SSI overpayments,
and used the savings to improve programs for teens aging out of foster care. Overall,
we have saved taxpayers and deserving beneficiaries literally billions of dollars. Despite
these tremendous strides, however, GAO will testify today that SSI remains on its list
of programs at high risk of waste, fraud, and abuse. More importantly, they and our
other witnesses – representatives of the Social Security Administration, the Social
Security Advisory Board, the Social Security Office of the Inspector General, and the
Consortium of Citizens with Disabilities – will provide us with insight and
recommendations on steps to better protect beneficiaries and taxpayers."

Notice how Herger blamed alcoholics and frauds for abusing the SSI program,
stating that it is because of this that the SSI program has been recieving less and less
support in Congress. He also mentions that the Subcommittee passed more legislation
to help recover SSI overpayments funds. Is it possible he is unaware of actual problems
in the SSI program – namely, that it exposes claimants to losing their homes and property
to the SSA? After all, how can Herger claim that SSI is a a vital safety net if it punishes
disabled people for earning money? After all, "Supplemental" means "in addition to", not
"alternative".

State Governments in the same Business

If you are a resident of Arizona and you are in a nursing home, you may also be eligible
for State provided care, under ALTCS, Arizona Long Term Care Systems. Other States
have their own form of disability or supplemental care, also. But according to Anonymous
Lawyer this may lead to the STATE confiscating the home of a person who is in a Nursing
Home through ALTCS upon the claimant’s death to recover expenses for the care.

Here, a beneficiary deed helps to protect the person, also, as it automatically transfers
property from the claimant to named person on Deed upon the claimant’s death.

Bush Administration Cutbacks Affect Disability Employment for Youth

If the threat to people on SSI or some form of State provided Disability Care is not enough,
the Republican Congress and Presidency are doing more. For one, the President’s 2006
Budget has slashed federal funding for disability employment as administered by the
Department of Labors (DOL) Office of Disability Employment Policy (ODEP) by 41 percent,
from $47.2 million to $27.9 million, "just the first step in eliminating the project altogether
within the next 2-3 years", according to the National Council for Support of Disability Issues.
(See http://www.ncsd.org/Newsletter/ncsdnews.htm)

But why? Has employment risen for the disabled? Thanks to Congressional policies on SSI,
SSI claimants have been barred from trying to earn more than $2000/yr if they wanted the
security of SSI. As a result, employment statistics for this group has been low. According
to NCSD, the unemployment rate of people with disabilities has hovered near 70 percent for
decades, despite the rather new ODEP program, an exceptionally high amount even if you
consider willful unemployment.

NCSD reports, however, that policies were put in place to help young people who were
disabled – not necessarily SSI claimants. "In its five short years, ODEP has already had a
significant impact on policies and programs to facilitate employment prospects for youth and
adults with disabilities."

But, now that dream is gone. With Federal support for those on SSI dwindling under the
Bush Administration, and no initiative taken before the 1990s, it seems probable that there is
little empathy towards disabled Americans in the political circle in Washington DC.

The Republicans in Congress have also been siphoning money out of conventional programs
like SSA and into faith-based organizations, citing that faith-based organizations are better
administrators, to make it seems like the problem is with the Administration and not the
Policies. How about enacting some favorable policies in Congress, as well as, pushing for
favorable administration?

Activism Alert!

You can end the unfairness. Act now!

Let your local Representatives and Senators know that SSI system needs to be fair to
disabled people. No more confiscating peoples homes! Tell them also to increase funding
for the Office of Disability Employment Policy which helps youth find work.

Direct them to this article at Juryfury.com.