Economic Stimulus Act & SSI

[TAXNJ]

Does the Economic Stimulus Act allow the following person to particpate in getting a "rebate"

Anyone know where a clear answer to the following two scernarios can be located:

1- A person living in a county or state nursing home paid by their Social Security medicaid benefits of more than $3000

2 - Disabled person living in a Group Home of which is paid by their Social Security medicaid benefits of more than $3000

thanks in advance

[TAXNJ]

SSI not counted

Anyone that still may offer some guidance on the #1 question - it would be appreciated.

After doing the post I have found the answer regarding #2 but not # 1

As far as the information on the IRS web-site regarding SSI - it is stated that:

For purposes of meeting the qualifying income requirement, the following benefits need to be reported in any combination on Line 20a of Form 1040 or Line 14a of the Form 1040A.

•Social Security benefits reported on the 2007 Form 1099-SSA, which people would have received in January 2008. People who do not have a Form 1099 may estimate their annual Social Security benefit by taking their monthly benefit, multiplying it by the number of months during the year they received the benefits, and entering the number on Line 20a of Form 1040 or Line 14a of the Form 1040A.

Supplemental Security Income (SSI) does not count as qualifying income for the stimulus payment.

[Koss]

Benefits

You need to clarify exactly what type of benefits the person is receiving.

Social security, Medicaid, and SSI are three different things.

Social security benefits flow from earnings record of the taxpayer, the taxpayer's deceased spouse, or the taxpayer's deceased parent (in the case of a minor). Social security benefits can be "old age" benefits, "disability" benefits, or "survivor" benefits, but they all flow from the earnings record.

Medicaid and SSI are government assistance programs for people who are retired or disabled and have little or no income.

Social security benefits are usually reported on Form SSA-1099. Whether they are reported or not, social security benefits are potentially taxable on the federal return if the person has income from other sources.

Medicaid benefits and SSI are never reported on an information return and they are never taxable.

Medicaid and SSI benefits, in terms of taxation, are roughly analagous to food stamps. It is need-based. It is not based on the earnings record. Not only is it not taxable, it's not even really income. It might as well be a gift from the local nonprofit, nongovernment food pantry.

Social security is almost like a pension plan. It is entirely based on the earnings record. It is retirement income. That's why it's reported on a Form 1099, just like an IRA or 401(k) distribution. In general it is not taxable, because it is treated as a return of the employee's contributions--unless you have too much income from other sources.

[JON]

Medicaid

payments from social secuirty to the nursing home are paid by person. You receive the social secuirty and pay the amount determined by medicaid to the nursing home. So you get the SSA form. Medicaid pays the balance owed to the nursing home. The state administors and balance in account of SSA receipient can not go over their allowed amounts. You should get the SSA form file the return and get the $300. As long as you do not go over the state limits you are fine. RIGHT????

[Koss]

Nursing home

payments from social secuirty to the nursing home are paid by person. You receive the social secuirty and pay the amount determined by medicaid to the nursing home. So you get the SSA form. Medicaid pays the balance owed to the nursing home. The state administors and balance in account of SSA receipient can not go over their allowed amounts. You should get the SSA form file the return and get the $300. As long as you do not go over the state limits you are fine. RIGHT????

In general, I agree that many elderly persons who are eligible for social security retirement benefits elect to somehow assign the monthly check to the nursing home where they live. The assignment may even be a contractual obligation if they want to continue living there.

I also agree that even if they make such an assignment, they are still constructively receiving the social security benefits, and this will qualify for the stimulus payment.

Finally, I would also agree that the stimulus payment itself is unlikely to cause a nursing home resident or medicaid recipient to become disqualified. It's a special type of tax refund, and tax refunds are almost never considered to be a form of income when determining a person's eligibility for government assistance. (Refundable credits such as EIC and Additional Child Tax Credit may be the exception to this rule. But I don't think the stimulus payment will be treated as a refundable credit.)

The confusion surrounding these issues, and the questions raised by the original post, stem from the fact that there is much loose talk that does not adequately distinguish between social security benefits, SSI, medicare and medicaid. It doesn't help that the 1099 form says SSA on it. Nonprofessionals see this and think it has something to do with SSI. Many people can't even tell you what SSA and SSI actually stand for, so it's not that surprising that people don't understand the difference.

Many people actually receive both social security and SSI.

SSI doesn't count as qualifying income for the stimulus payment. Social security benefits do.

There are three types of social security benefits: retirement, survivor, and disability. All three types of social security qualify as income for the stimulus payment.

Some people think that anyone who is "on disability" is getting SSI; people have the misconception that SSI is the "disability" type of social security. This is entirely incorrect. Some people who are disabled get SSI, some get social security and some get both.

My understanding is that to get SSI, you have to meet the following requirements:

(1) Either you are disabled, retired, or widowed, as these terms are defined by the Social Security Adminstration, and

(2) You either don't qualify for social security retirement, disability, or survivor benefits, or you qualify for the benefits but they are not enough to live on (as defined by federal poverty levels).