My brother knows he did not have long to live and set up a third-party special needs trust for his son. His son collects SSI. My brother transferred his house into the trust so his son could live there. He wanted his son to live there rent free, but now I hear his free rent might be "in-kind" support. I had thought that the free rent would not count as this in-kind thing because it is in a third-party special needs trust.
Can anyone help? My brother has nothing but this small house for his son and should die within the next few weeks. I want to help out by maybe living with is son, but I don't have much income to hire a lawyer
Your question involves an area of the law where very fine distinctions make all the difference of whether the "in-kind" income will reduce/eliminate SSI benefits, or not. To provide a complete and accurate answer, an attorney would need more facts, and many of us will provide a no-cost consultation where you might get some direction on this issue.
With that being said, whether the arrangement you describe in respect to your nephew living in the home will result in a reduction or elimination of SSI benefits depends on a number of factors. Some of the most important questions are: does the home have a mortgage on it that is paid by the Trustee? Are property taxes, home owners insurance, and utilities paid by the Trustee? An answer of "yes" to these questions MAY mean a reduction/elimination of SSI benefits. This is because such expenditures could be classified as "shelter", and the theory is, if the recipient's shelter needs are covered by a resource other than SSI, the recipient has no true need for a part or all of the SSI benefit.
Also, you should speak with an attorney regarding the issue of your potential living in the home. This must be analyzed carefully because questions of whether rent would be owed by you and questions of what value your assistance to your nephew is worth have an impact on the validity of the trusts operation.
I recommend that the trustee of the trust (the person managing the trust) speak with an attorney who practices Special Needs and Elder Law planning to get the trust reviewed so that the attorney can provide answers to these questions and give an explanation of best practices going forward with the trust. Again, many of us provide a free consultation and you may be able to work out a reduced cost or pro bono arrangement.
Best of luck, and if you found this answer helpful, please mark the answer as "helpful."
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There is no attorney responding on this message board who can give the sort of advice you need in a paragraph or two. Schedule some time with an experienced probate attorney to make sure you understand everything you can about this complicated situation.
Best of luck!
In no way am I offering you legal advice, and in no way has my comment created an attorney-client relationship. You are not to rely upon my note above in any way, but insted need to sit down with counsel and share all relevant facts before receiving fully-informed legal advice. If you want to be completely sure of your rights, you must sit down with an experienced attorney to be fully aware of your rights. Finally, please forgive any typographical errors in my note!
You are right to be concerned. As long as the SSI recipient is paying less than their fair share of rent and living expenses this is a factor in their SSI benefits. Your brother, or the trustee of the trust should consult an attorney experienced in drafting special needs trusts. I believe this would be an expense of the trust, and therefore, should not be something you pay for - but the attorney can readily answer that question in the initial consultation. It is essential that the trustee get informed advice.
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