Does a Gift of Money Affect Your Social Security Benefits?

The holiday season is a time for giving and receiving gifts, but it’s important to understand how gifts can affect your Social Security benefits. This guide will help you understand how gifts are treated by Social Security for the SSDI (Social Security Disability Insurance) and SSI (Supplemental Security Income) programs.

SSDI and Gifts

The good news is that gifts do not affect SSDI benefits at all. You don’t even have to report them to Social Security. So, if the only Social Security payment you receive is SSDI (or a Childhood Disability or Disabled Widow Benefit), you can rest assured that gifts will not impact your benefits in any way.

SSI and Gifts

SSI, on the other hand, is a needs-based program. This means that your eligibility and payment amount are affected by your income. Social Security may count a gift as income, depending on the nature of the gift.

Gifts that are counted as income:

Cash
Food
Items that would not be considered a partially or totally excluded non-liquid resource if retained in the month after the month of receipt.

Gifts that are not counted as income:

Personal items and other things that would be considered a partially or totally excluded non-liquid resource if retained in the month after the month of receipt. This includes a car, if it is the only one you have.
Gifts from family members, friends, or charitable organizations, as long as they are not given in exchange for goods or services.
Up to $60 cash per calendar quarter, if the cash is received from a single source and you did not receive a gift of cash the month before or after.

Reporting Gifts to Social Security

It’s important to report any cash or food gifts you receive to Social Security. They will determine the nature of the gift and apply the appropriate rules.

Gifts and the SSI Redetermination Review

Social Security will ask you about gifts during the SSI redetermination review, which usually happens once a year. If you say that you received a gift, Social Security will normally accept a signed estimate of the value unless there is reason to doubt the estimate.

While gifts do not affect SSDI benefits, they can impact your SSI eligibility and payment amount. It’s important to understand the rules and report any cash or food gifts you receive to Social Security.

Additional Resources

Disclaimer

This guide is for informational purposes only and should not be considered legal advice. Please consult with an attorney for legal advice specific to your situation.

B. Procedure for considering gifts

Unless you have reason to doubt the estimate, accept an individual’s statement estimating the value of the gift (or actual value if cash), either signed or recorded on the Report of Contact page. If you have any reservations about the estimate, find out the item’s current market value (CMV) from a reliable source. For the definition of CMV, see SI 00835. 020. See GN 00301 for guidelines on the documentation and preservation of electronic evidence. 286.

Gift as income

Unearned income is considered a gift and is governed by the general income and income exclusion regulations.

REMINDER: Any non-cash item (apart from food and shelter) that, if kept in the month following the month of receipt, would entirely or partially become an excluded non-liquid resource is not considered income. For more information about this exception, see SI 00815. 550.

How Can I Gift Money To Kids Without Being Taxed?

FAQ

Does a cash gift affect Social Security benefits?

If you receive cash or food, they typically count as income. Social Security won’t count the following gifts when deciding SSI eligibility or payments: Personal items and other things that will not count toward the $2,000 asset limit the month after you get them.

Can I give money to someone on benefits?

No. As long as the payments are truly voluntary gifts (not taxable, in return for work or spousal maintenance — for example) then they will not be classed as income and Universal Credit cannot take them into account.

Will a grant affect my Social Security?

Social Security Disability Insurance (SSDI) Individuals who are getting SSDI may be eligible for a Pell Grant if there is financial need. Pell Grants do not affect SSDI benefits.

What happens if you win money while on SSI benefits?

SSI payments are reduced by income, both earned and unearned. Gambling, lottery winnings and prizes are concerned unearned income. If you win $500, your SSI check should be reduced by $500. You would still have $223 of SSI so you would still be eligible for Medicaid.