Hi Larry, I’m 37 years old, divorced female, deemed disabled in 2017 by SSA. I receive SSI and the RI state supplement of approx $40. Anyhow, I will likely be receiving a settlement from a personal injury lawsuit and have been hearing and reading much conflicting advice. Am I able to report the settlement and suspend my SSI payments until the settlement is spent (it likely will be under $70k)? Should I look into setting up a special needs trust for myself? Is that even possible? Any help is appreciated!
You can't qualify for Supplemental Security Income (SSI) if you have non-excludable assets totaling more than $2000. Excludable assets include such items as a home in which you live, and one vehicle. Other examples of excludable assets can be found on Social Security's website: https://www.ssa.gov/ssi/spotlights/spot-resources.htm. Trust accounts generally still count as assets for SSI purposes, so ownership in a trust fund valued at over $2000 would still likely make you ineligible for SSI.
Assuming that the proceeds from your settlement aren't invested in an excludable asset such as a home, Social Security would generally suspend your benefits for up to a year and then then terminate your record. You'll want to be sure to report receipt of the settlement proceeds timely in order to prevent a possible overpayment of benefits that you'd be expected to repay. If you spend down your countable assets to below $2000 while your SSI payments are still in suspense, your payments can potentially be reinstated without a new application. After a year's time passes, though, you'd need to reapply in order to establish re-entitlement to SSI benefits.