Stimulus payments are not supposed to be used to determine eligibility for social insurance
programs such as disability
benefits, but some people may have lost benefits due to having too much money
in their bank accounts.
According to legal aid attorneys, the Social Security
Administration has suspended disability benefits for some Supplemental Security Income
recipients because the stimulus payments exceeded the program's antiquated $2,000 limit.
“The whole point of stimulus was to help people who were being harmed during COVID, and now there will be people facing a cessation of benefits and they will end up in a worse place,” said Michelle Spadafore, senior supervising attorney with the New York
Legal Assistance Group, citing several cases in New York that she is aware of.
The program provides $794 monthly to people with disabilities
and limited resources who can't earn much on their own. Most SSI recipients would have been eligible for full stimulus payments under the three coronavirus
relief bills passed by Congress
Everyone receiving SSI is subject to the resource limit, which has not been updated since 1989 and is $2,000 for individuals and $3,000 for couples, with exclusions for a home, a car, and certain other assets.
Because the coronavirus stimulus payments are technically tax credits, they should not have affected eligibility for any social program, including food
stamps and Social Security, because tax credits do not count as income or “resources” for eligibility purposes within a year of receipt under federal law.
However, the Social Security Administration is a large organization with many employees, and it is possible that some have made mistakes, according to Stacy Cloyd, director of policy and administrative advocacy for the National Organization of Social Security Claimants’ Representatives. What should happen, Cloyd says, is that when the agency sees more than $2,000 in someone’s bank account, the overall balance is all tallied.
“If the resource limit was $10,000, this would be a lot less of an issue,” Cloyd said, noting that President Joe Biden
has proposed updating the asset limit, but Democrats
have yet to reintroduce their bill to change the policy.
To have this money, I'll have to pay for it.
Joseph Morris, SSI recipient
Morris, 67, of Philadelphia
, said the Social Security Administration notified him last year that he had lost eligibility for Supplemental Security Income payments because he had more than $2,000 in his bank account from June to November, which he attributed to the $1,200 payment he received from last year's Coronavirus Aid, Relief, and Economic Security Act.
Morris requested reconsideration, but the agency upheld its decision in March. Beginning next month, Social Security will deduct 10% of Morris' monthly benefits until the agency recoups the several thousand dollars it believes it overpaid him last year.
Morris regards it as absurd, and believes that losing $79 from his monthly income will make it difficult to pay his electric bill.
“You're going to give me a stimulus check to stimulate the economy
, and I can't go out because of doctor's orders, and you're punishing me for having this money,” Morris said, adding, “Now it's going to cost me money to have this money.”
Morris' attorney, Richard Weishaupt of Community Legal Services of Philadelphia, said he has another client who is facing the same issue and is hoping to persuade the agency to reconsider.
“It’s happening to a disturbing number of people,” Weishaupt said, adding that because of the coronavirus, both Social Security and legal aid offices are closed, making it impossible for people on disability to walk in and ask for assistance as they could before the pandemic
According to Mark Hinke, a spokesman for Social Security, the economic impact payments approved by Congress do not count as income under program rules and should not result in a loss of benefits.
“Aside from EIPs, there may be other income and resource considerations that may cause a change in an SSI recipient’s benefit amount,” Hinke said, adding that recipients should contact their local office with any questions or concerns about their benefits, and we will assist them.
Though stimulus payments aren't supposed to affect someone's eligibility for a social program for a year, that's only true for a year. Since CARES Act payments began in April
2020, people who still have the extra money in their bank accounts may legitimately run afoul of SSI's resource limit in the coming months.
During a Senate
Finance Committee hearing last month, Sen. Bob Menendez (D-NJ) complained that a constituent on SSI was having their benefits suspended because they had received too much money in federal unemployment benefits
. Congress increased benefits dramatically in the CARES Act, adding an extra $600 per week and expanding eligibility to include part-time workers, which may have made more SSI recipients eligible.
Grace Kim, an acting assistant deputy commissioner for Social Security, described it as “an issue that we are currently looking into.”
“I don’t believe Congress intended to provide individuals with the type of relief that we did during the pandemic only to have them lose their SSI,” Menendez said, adding that “that could never have been Congress’ intent at the end of the day.”