The receipt of unearned income during a month will generally result in a dollar-for-dollar reduction in Supplemental Security Income benefits (“SSI”); subject only to the $20 exclusion amount.  Whether a gift card/certificate is deemed income depends upon the restrictions placed upon its use.  

If a special needs trust (a “SNT”) pays a credit card bill, the consequence of that payment depends upon what was on the bill!  For example, if the SNT pays a restaurant charge made while the beneficiary is home, it will reduce his or her Supplemental Security Income (“SSI”) benefit.  If, on the other hand, the SNT pays a charge for clothing it will not result in a reduction of SSI benefits

The answer to the question is: “It Depends.”  The SNT should not pay for a restaurant meal while the beneficiary is at home; but, it can pay for restaurant meals while the beneficiary is on vacation!  

Trusts are more commonly used in the Estate Plan of a middle-class New Yorker than conventional wisdom would predict.  For instance, a trust for the benefit of minor children is always a good idea when planning for their lives after the death of both parents.  Parents and grandparents of a child with special needs will find the many advantages of a supplemental needs trust worth exploring. Elderly couples may find an irrevocable income only trust a useful tool in their Medicaid Planning.