Can You Buy a House on SSI and Keep Your Benefits?

Supplemental Security Income (SSI) is a federal program providing financial assistance to adults and children with limited income and resources who are aged, blind, or have a disability. Administered by the Social Security Administration (SSA), SSI helps millions meet basic needs. Many recipients wonder about homeownership and its interaction with SSI benefits. Understanding the specific rules is important for those receiving this assistance.

SSI Resource Rules and Homeownership

Supplemental Security Income eligibility depends on an individual’s countable resources remaining below specific limits: $2,000 for an individual and $3,000 for a couple. Resources include cash, bank accounts, stocks, and other assets convertible to cash. However, certain items are excluded from these limits, meaning they do not count against the eligibility threshold.

A significant exclusion from SSI resource limits is the home where an individual resides as their primary residence. The value of this home, including the land it sits on, is not counted toward the resource limit, regardless of its worth. This exclusion also extends to related outbuildings and adjoining land.

For a property to qualify as a primary residence under SSI rules, it must be the dwelling an individual considers their main home, and to which they intend to return if absent. This can include traditional houses, mobile homes, or houseboats. Adjoining land is excluded if not completely separated from the home plot by land owned by others, even if under a separate deed.

A home might not be excluded from resource calculations in certain instances. If a property is not used as the individual’s primary residence, or if it includes additional dwelling units not occupied by the recipient, it could be a countable resource. Similarly, if an individual moves out of their home without intent to return, the property becomes a countable resource from the first day of the following month.

Exceptions exist for individuals who leave their home but still qualify for the exclusion, such as those institutionalized if a spouse or dependent relative continues to live there. The home exclusion also applies if an individual leaves due to domestic violence, with the home remaining excluded until a new primary residence is established. Providing documentation like deeds, property tax assessments, or mortgage statements can help demonstrate ownership for exclusion purposes.

Funding a Home Purchase While Receiving SSI

Acquiring funds for a home purchase while on SSI requires understanding how different financial inflows are treated under income and resource rules. SSI distinguishes between income, money received in a calendar month, and resources, assets owned. This distinction is important because how funds are categorized can affect benefit amounts and eligibility.

Gifts of money received for a home purchase are counted as income in the month they are received. This can lead to a reduction in SSI benefits for that month. Any portion of the gift remaining at the beginning of the following month that exceeds the resource limit would then be counted as a resource, impacting future eligibility.

Loans, when structured with a bona fide repayment agreement, are not counted as income for SSI purposes. Funds received as a loan for a home down payment or purchase would not directly reduce monthly benefits. However, if held beyond the month of receipt, the loan proceeds would count as a resource in subsequent months and must remain within the SSI resource limits.

Personal savings accumulated by an SSI recipient can be used for a home purchase, provided these savings do not exceed the resource limits prior to the purchase. If existing savings or other assets already exceed the limit, those funds would need to be spent down to qualify for or maintain SSI. Purchasing an excluded home is a permissible way to spend down excess resources.

Certain financial assistance programs may offer support without adversely affecting SSI benefits. For example, some government housing assistance, such as Section 8 vouchers, and Supplemental Nutrition Assistance Program (SNAP) benefits are not counted as income or resources. Some grants and scholarships are also excluded from income calculations.

While some forms of “in-kind support and maintenance” (ISM), where someone else pays for shelter costs, can reduce SSI benefits, this does not apply to the value of food received as of September 30, 2024. However, shelter-related ISM can still lead to a reduction in benefits by up to one-third. It is advisable to clarify with the SSA how specific financial assistance or gifts might impact benefits before receiving them.

Reporting Changes to the Social Security Administration

Once an SSI recipient purchases a home, it is important to promptly report this change to the Social Security Administration. The SSA requires timely notification of any changes that could affect an individual’s eligibility or benefit amount. This includes alterations in living arrangements, address, income, and resources.

The acquisition of a home constitutes a change in living arrangements and potentially in resources, especially if funds remain after the purchase. These changes must be reported to the SSA no later than 10 days after the end of the month in which they occurred. Failing to report within this timeframe can lead to consequences, including overpayments, benefit reductions, or penalties.

There are several ways to report changes to the SSA. Individuals can report online through their “my Social Security” account for certain updates, though specific changes like living arrangements for SSI recipients may require other methods. Reporting can also be done by phone, by mail, or in person at a local SSA office. It is advisable to obtain confirmation of any reported changes for personal records.

When reporting, it is important to provide accurate details about the home purchase and any remaining funds. The SSA may require documentation to verify the changes, such as proof of ownership or details of financial transactions. Proactive and timely reporting helps ensure continued benefit accuracy and avoids disruptions or financial repercussions.