When parents with a disabled child gets divorced, often child support is awarded. In fact, child support can be awarded through the divorce to continue on much longer than which is awarded for a child without disabilities. This award of child support is both good and bad.
Child support paid on behalf of your child with special needs impacts the amount they receive of SSI whether they are under the age of 18 or receive child support as an adult paid beyond the age of 18. The child who receives SSI under the age of 18 will have up to two-thirds of the child support payment reduce the SSI benefit. When your child with special needs turns 18 and becomes an adult, the entire amount of the child support payment will be treated as income to the child and reduce their SSI benefit, all but for $20. This is true even if the child support is paid to the custodial parent. This child support payment still belongs to the disabled child.
Child support is designed to be a financial benefit to the child, to help support the child’s basic needs. In similar fashion, SSI’s purpose is to provide cash to meet the basic needs for shelter, or provide a minimum level of income for persons who are disabled. Unfortunately, the benefit provided by child support payments for a disabled child is lost due to this resulting offset against the receipt of any SSI benefit.
There is a little known solution to this problem of keeping the benefit from both the child support payments and the full SSI benefit. At any point in time, child support payments may be directed to an irrevocable first party special needs trust. By assigning the child support payments to the trust, usually by action through the Court, the SSI benefit will not be reduced; and the child support payment will no longer be seen as income received by or on behalf of the child for SSI purposes.
We can assist your divorce attorney in navigating these issues involving child support as a special needs planning lawyer. If you are already receiving child support on behalf of your disabled child, we can assist in putting in place measures to secure the full SSI payment. Please contact us if you would like to know more about these solutions to protect your child’s SSI benefit if they are receiving child support.
