Yesterday was Thanksgiving, which means that the next few days will be devoted to one of America’s favorite activities: shopping. Between Black Friday, Small Business Saturday, and Cyber Monday, Americans waste no time hitting the stores to stock up on gifts in preparation for Christmas and other winter holidays.
Gift cards are a great holiday present for friends and family who are a little trickier to buy for. They’re a way of showing that you know what a person wants or needs, but you know they’d really like to pick it out for themselves. If you’re living on Social Security disability benefits, you may ask for gift cards so you can purchase things you really need instead of asking for things you merely want.
However, gift cards may affect your Social Security disability benefits. It depends on the type of benefits you receive and the type of gift card you open up on Christmas Day.
How Your Income Affects Your Benefits
The only way gift cards can affect your disability benefits is if the Social Security Administration (SSA) considers them as income.
There are two Social Security disability programs from which you may receive benefits: disability insurance benefits (DIB) and supplemental security income (SSI). Both are subject to certain income limitations, but the criteria are different for each program.
For DIB, you can’t engage in substantial gainful activity (SGA) in order to qualify for benefits. Substantial gainful activity is measured by a certain level of monthly income. The specific amount of income typically changes from year to year. In 2017, SGA is $1,170 a month for non-blind individuals, and $1,950 a month for the blind. That will increase to $1,180 for the non-blind and $1,970 for the blind in 2018. If your income is above SGA, the SSA believes you’re not too disabled to work and may cancel your benefits or deny your application for benefits.
For SSI, your household income must be below the federal benefit rate (FBR). However, the SSA only counts certain parts of your monthly income, making it difficult to determine whether or not you’re above the FBR. For example, fewer than half of your monthly income from work counts toward the income limit. In 2018, the FBR is $750 for individuals and $1,125 for couples.
Do Gift Cards Count as Income?
The SSA typically only counts gift cards as income if the gift card can either be used to purchase food or shelter or can be resold.
For example, an iTunes gift card wouldn’t count as income because it can only be used to purchase music and cannot be resold. However, if you receive a prepaid Visa gift card for Christmas, that can typically be used to purchase food or shelter, so that may count as income.
If your gift card counts as income, it will count for the month in which you receive it. Any remaining balance on the gift card will roll over into the following month as a resource. This only applies to people who receive SSI. For SSI, you can only have $2,000 in countable resources as an individual or $3,000 as a couple.
When Gift Cards Are Excluded from Income
The SSA acknowledges, of course, that many benefit recipients receive gift cards from friends and family for holidays, birthdays, or other special occasions. Therefore, the SSA is allowed to exclude gift cards from income if it is considered irregular or infrequent.
For example, let’s say your son gives you a $100 Visa gift card for your birthday in November. Because you didn’t receive any other “income” from your son that month, the SSA may exclude the gift card as infrequent or irregular income. However, if you don’t spend the entire gift card in November (the month in which you received it), the remainder may be counted as a resource in December.
However, if your son frequently gives you a $100 Visa gift card at the beginning of every month to help you purchase groceries, that would typically be considered income.
The SSA also makes exceptions for individuals who receive gift cards from the government following a natural disaster.
Help from an Indiana Disability Lawyer
Generally, you don’t have to worry about a $50 gift card to Office Depot affecting your disability benefits. However, if you have questions, it’s a good idea to speak with the SSA about how gift cards may affect your eligibility for benefits.
If you’re considering applying for disability benefits but aren’t sure if you’re eligible, an Indiana disability lawyer can look at your case and help you determine whether DIB or SSI is right for you. Call Hensley Legal Group today or contact us online for a free consultation.