The Social Security Administration (SSA) treats SSDI (Social Security Disability Insurance) benefits and SSI (Supplemental Security Income) benefits differently. If you receive SSDI benefits, SSA generally won’t reduce your benefits just because you live with a family member who has their own income. However, the rules for SSI are different.
In previous blog posts, we discussed how SSI beneficiaries might see their benefits reduced if they receive help paying for food and shelter, how to avoid such a reduction, and how earned and unearned income can reduce SSI benefits. Another type of income to understand is “deemed income.”
What Is Deemed Income?
Deemed income is income that someone else receives, but that SSA treats as if it is available to the SSI applicant or recipient. In other words, you might not actually receive the money yourself, but SSA may still count part of that money when deciding whether you qualify for SSI and how much your monthly benefit should be.
The most common examples are parent-to-child deeming and spouse-to-spouse deeming.
Parent-to-Child Deeming
If a child under age 18 applies for SSI, SSA may consider part of the income of the child’s parent or parents. This can include earned income, such as wages, and unearned income, such as certain benefits or other payments.
However, SSA does not simply count all of the parent’s income against the child. Instead, SSA applies a formula. In general, SSA first sets aside certain amounts for the parent or parents and for other children in the household. SSA also treats earned income and unearned income differently. After applying the relevant exclusions and allowances, only the remaining income, if any, is deemed to the child.
If two parents live in the household, SSA generally looks at both parents’ income. A stepparent’s income may also count if the child’s parent or adoptive parent lives in the household.
Spouse-to-Spouse Deeming
If an SSI applicant or recipient lives with a spouse who does not receive SSI, SSA may deem part of the spouse’s income to the SSI applicant or recipient.
Again, this does not mean that SSA counts every dollar the spouse receives. SSA distinguishes between earned income and unearned income, applies certain exclusions, and may also set aside an amount for children in the household. After that, the remaining income may reduce the SSI benefit or make the person ineligible for SSI.
Spouse-to-Spouse-to-Child Deeming
Some households involve more than one SSI applicant or recipient. For example, a disabled child may live with one parent who has applied for SSI and another parent who has income but does not receive SSI.
These situations can be especially complicated. In general, SSA may first determine whether income should be deemed from the ineligible spouse to the parent who applied for SSI. If the parent remains eligible for SSI after that calculation, then income may not be deemed to the child. But if the parent becomes ineligible because of deemed income, then some remaining income may be deemed to the child.
Because these household situations are complicated, small factual differences can change the result.
Deemed Income Can Affect Eligibility and Monthly Payment Amounts
Deemed income can reduce a monthly SSI benefit. In some cases, deemed income can also make someone financially ineligible for SSI altogether.
This is especially important for disabled children. A child may meet the medical requirements for SSI, but still be denied because SSA decides that too much parental income is deemed to the child. However, deeming based on parental income generally stops after the child turns 18. For that reason, some individuals who were financially ineligible for SSI as children may become eligible as adults.
If you would like assistance with your Social Security disability benefits application or appeal, please contact one of Hawks Quindel S.C.’s experienced disability attorneys for a free consultation. We help individuals throughout the Midwest.