Social Security Administration and SSI

• Using federal funds, each state's Social Security Administration administers the Supplemental Security Income program providing cash benefits, health insurance through Medicaid, food stamps and other welfare benefits to low-income individuals in that state. In addition to limited incomes, qualified applicants must be 65 years of age or older, disabled or blind to receive SSI.
  
  

SSI and Parental Income

• SSI helps low-income disabled or blind individuals with cash assistance. If the child is under 18 years of age and receives SSI, then without the exclusion, the government could impute the custodial parent's total income to the blind or disabled child. This could exclude the child from any SSI benefits, but the one-third exclusion minimizes the opportunity for total exclusion.
  
  

Policy Reasons for Excluding Portion of Child Support

• Prior to the enactment of new laws, a higher portion of child support payments were included in total household income. This higher exclusion amount created an unfair result for parents who received child support payments and created incentives for noncustodial parents to avoid paying monthly child support obligations. Because of the policy implications, Congress passed new legislation allowing parents receiving child support payments to exclude a larger portion of their monthly child support payments from their total household incomes. This allowed needy families who received child support to qualify for a larger amount of SSI benefits.
  
  

TANF and SSI

• The Temporary Assistance for Needy Families Program is another public welfare benefit provided to low-income families. Many individuals receiving SSI also receive TANF benefits to help afford basic living expenses and food. Under the TANF program, TANF recipients receiving child support must agree to allow the recipient's state government to collect child support payments on their behalf. State governments share their child support collections with the federal government to subsidize the TANF benefits. However, the Social Security Administration does not require the assignment of benefits from its SSI recipients. The Administration considered the policy reasons for providing noncustodial parents with incentives to continue paying their child support obligations since parents seemed more inclined to pay when their payments directly benefited their children, not the government.
  
  

Legal Considerations

• Since child support payments may affect the low-income custodial parent's abilities to collect SSI compensation, attorneys helping their clients draft property settlement agreements and divorce agreements must consider the financial implications to their clients.
  
  Since family and social security laws may frequently change, you should not use this information as a substitute for legal advice. Seek advice through an attorney licensed to practice law in your jurisdiction.