How will SSA treat alimony\child support payments?

Congress created the exemption trusts under 42 USC sections 1396p(d)(4)(A) & (C) to allow a person who has funds to transfer those funds to a SNT or Pooled SNT trust and continue to receive Medicaid benefits. SSI adopted the philosophy that a person can set aside funds and maintain eligibility for SSI in 1999 legislation. Therefore when the parents divorce and one parent is ordered to pay child support into the child’s trust, can the child maintain eligibility for SSI if the trust meets the requirements of 42 U.S.C. §1396p(d)(4)(A) or (d)(4)(C) and POMS SI01120.203?

SOLUTION: If there is a court order which directs the parent to make child support
payments (or a spouse to make alimony payments) directly to the trust, and we have
determined that the trust is not a countable resource for SSI purposes, then the child
support or alimony payments would not be income. The policy in SI 01120.200G.1.d and in SI 01120.201J.1.d explains that income irrevocably assigned into a trust is not income and would apply to court-ordered assigned child support and alimony paid to an excluded trust. Regulations at 20 CFR 416.1102 provide that income is anything that you “receive” which can meet your needs for food or shelter. Since the trust is not an available resource,
irrevocably assigned alimony/child support payments paid into the trust are also not
available, and thus, the child/spouse has not “received” income.

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