Receiving Social Security Disability or Supplemental Security Income? Here’s What You Need to Know About Covid-19
Loss of Normal Income
If you receive SSI and either you or your spouse has lost income due to Covid-19, you need to report the loss of income to Social Security by calling 1-800-772-1213. By reporting a loss of income, your SSI monthly payment may increase.
Stimulus Checks for Disability Recipients
Information about stimulus checks is changing rapidly and it can be especially confusing for individuals receiving Supplemental Security Income (SSI) or Social Security Disability (SSD). The most recent advice from SSA helps to clarify:
Social Security retirement, survivors, or disability beneficiaries and Supplemental Security Income (SSI) recipients who do not have qualifying children under age 17:
You do not need to take any action with the IRS. You will automatically receive your $1,200 economic impact payment directly from the IRS. You should receive the automatic payments by direct deposit, Direct Express debit card, or by paper check, just as you would normally receive your Social Security benefits.
People who receive Social Security retirement, survivors, or disability insurance benefits, who did not file a tax return for 2018 or 2019, and who have qualifying children under age 17 and those receiving SSI who have qualifying children under age 17:
Go to the IRS’s webpage to enter your information instead of waiting for your automatic $1,200 Economic Impact Payment. By taking proactive steps to enter information on the IRS website about you and your qualifying children, you will also receive the $500 per dependent child payment in addition to your $1,200 individual payment. If Social Security beneficiaries and SSI recipients in this group do not provide information to the IRS soon, you will have to wait to receive $500 per qualifying child.
The IRS page link above has two options; Filer and Non-Filer. if you normally file tax returns every year, you will choose the Filer option to enter your current information and your child’s information so that you receive the $500 per dependent benefit. If you do not normally file tax returns, select the “Non-Filer” option. It should be noted that the economic relief payments will not be counted as income for SSI recipients and will not compromise SSI eligibility.
Garnishment
Depending on the state and the creditor, the stimulus funds may be subject to garnishment. The National Consumer Law Center recently released an article, Protecting Against Creditor Seizure of Stimulus Checks. In the article, they detail a strategy to protect Social Security recipients from garnishment:
A special strategy for those at risk of garnishment is available for recipients of Social Security, SSI, Veterans, or certain other federal benefits. A U.S. Treasury rule exempts from garnishment an amount in a bank account or Direct Express card equal to two months of federal benefit payments for that individual. See NCLC’s Collection Actions § 14.5.4.
The protected amount in a consumer’s account need not be traced to the federal benefits—that dollar amount is protected no matter its source. If two months of federal benefits for a Social Security recipient is $2000, their account will be fully protected from garnishment if there is only $800 in the bank account before the stimulus payment is deposited. Once the $1200 is deposited, the total amount is less than $2000. Before the next Social Security or other benefit payment is deposited, however, they will need to withdraw additional amounts to keep the new balance under $2000. Fortunately, benefit payments come on a predictable date each month, such as the second Wednesday of the month.
This strategy comes with a cost, as described above, since it may be more convenient and safer to keep all funds in the bank account than to rush to withdraw cash or make payments from the account.
We will continue to post the latest information pertaining to Social Security and Covid-19 here on our blog!