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Posted by robert.moredock@gmail.com on February 5, 2007, 1:51 am
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My autistic son has a special needs trust, currently funded
with about $20K in cash (and more on my death & my spouse's
death)
He purchased his own home about 5 years ago, after being in
an adult foster care home and getting abused there. He
currently lives there, with caregivers funded by the local
community mental health agency.
When the home was first purchased, we budgeted the full
amount of his SSI to meet expenses, with some occasional
help from us to handle things like new clothes. So far so
good.
I received a notice form Social Security about 3 months back
saying they had erred in paying his benefits by about
$200.00 per month (from the time he moved from the AFC home
into his own home, even though he must be 100% supervised at
all times) and that they were dropping his monthly SSI
stipend AND taking an additional 10% of the reduced check
amount to recover the overpayments. So-------there goes his
budget, which was already stretched to the limit.
We have begun looking for a room mate and have a few
candidates. The issue of this question arises from the
handling of "rent" income from the roommate. We were
thinking $375/month, but that amount would have to be
declared as income to my son and his benefits would then be
further reduced. (Ouch again)
I had thought of transferring the house to the special needs
trust (probably by land contract sale for "$1 and other
valuable consideration") and then having both my son and the
renter pay rent to the special needs trust and the trust
assuming and making mortgage and other payments on his
behalf. During the pendancy of the land contract, title
could and probably would remain in my son's name, thus
preserving about $1,300 in homestead and heating tax credits
annually.
Is this kosher (special needs trust acquiring an asset and
then collecting rental income) and most of all, would it
pass muster with Social security? There may be pitfalls, I
just do not see, if you see any, please point them out...
Thank you.
Bob
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