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SSI Estate Planning: Trusts and Burial Funds

This guide presents selected U.S. government consumer education from Social Security Administration. References to “we” or “us” in the source material refer to the issuing agency. Source dates and links appear below.

Spotlight On Trusts

As of January 1, 2000, the supplemental security income (SSI) law on trusts changed. This information applies to trusts established on or after January 1, 2000.

What Is A Trust?

A trust is a legal arrangement regulated by State law in which one party holds property for the benefit of another. In certain situations, a trust can be set up for an SSI recipient. A trust can contain:

    cash or other liquid assets; and real or personal property that could be turned into cash.

How Does A Trust Affect My SSI Benefits?

If you use your assets to establish a trust on or after January 1, 2000, generally, the trust will count as your resource for SSI.

    In the case of a revocable trust, the whole trust is your resource. In the case of an irrevocable trust, if there are any circumstances under which payment could be made to you or for your benefit, the portion of the trust from which payment could be made is your resource.

See the SSI Spotlight on Resources for more information about resources and SSI.

What Things Count As Assets And Are Used To Establish A Trust?

Assets usually include your:

    income (countable and excluded); resources (countable and excluded); and property or payments that you have a right to but do not receive.

Are There Any Exceptions To The Law On Trusts?

The law does not apply to:

    trusts under Section 1917(d)(4)(A) of the Social Security Act, which are often called "special needs trusts"; and trusts under Section 1917(d)(4)(C) of the Social Security Act, which are often called "pooled trusts."

We will also not count the trust if counting it causes you hardship, and you meet the undue hardship criteria.

    Certain revocable trusts under Section 1917(d)(4)(A) or (C) of the Social Security Act may still count as your resource.

How Does Money From A Trust That Is Not My Resource Affect My SSI Benefits?

    Money paid directly to you from the trust reduces your SSI benefit. Money paid directly to someone to provide you with shelter reduces your SSI benefit but only up to a certain limit.  No matter how much money is paid for these items, we subtract no more than $351.33 (in 2026) from your SSI check for the month you receive the items. Money paid directly to someone to provide you with items other than food and shelter does not reduce your SSI benefits. (Items that are not "food or shelter" include medical care, telephone bills, education, entertainment, etc.)
    • Effective 09/30/2024, food is no longer included in ISM calculations. This means that the value of food will no longer reduce your SSI payment. Prior to 09/30/2024, food or shelter were included in the ISM calculations; and the receipt of food from inside or outside the home was counted as ISM.

How Can I Find Out More About Setting Up A Trust?

We cannot tell you how to set up a trust. You may consult a lawyer or financial advisor to find out more about trusts.

Your local Social Security office has a list of groups that can find you a lawyer or give you free legal services if you qualify. You may also contact the State or local bar association or the Legal Services Corporation for legal assistance if you qualify.

Some trusts and trust payments that we do not count as your resources or income for SSI purposes can affect your Medicaid eligibility.

Contact your State if you need more information about how trusts and trust payments can affect Medicaid eligibility.

Additional rules apply to trusts established by representative payees. Your representative payee should contact the local Social Security office for more information.

THIS INFORMATION IS GENERAL.
FOR MORE INFORMATION, CALL 1–800–772–1213 (TTY 1–800–325–0778),
VISIT OUR WEBSITE (www.ssa.gov) ON THE INTERNET,
OR CONTACT YOUR LOCAL SOCIAL SECURITY OFFICE.


Spotlight On Burial Funds

What Is A Burial Fund?

A burial fund is money set aside to pay for burial expenses. For example, this money can be in a bank account, other financial instrument, or a prepaid burial arrangement.

Some States allow an individual to pre-pay for his or her burial by contracting with a funeral home and paying in advance for his or her funeral.  You should discuss this with your local Social Security office.

Does A Burial Fund Count As A Resource For SSI?

Generally, you and your spouse can set aside up to $1,500 each to pay for burial expenses. In most cases, this money will not count as a resource for Supplemental Security Income (SSI).

If you (or your spouse) own life insurance polices or have other burial arrangements in addition to your $1,500 burial funds, some of the money in the burial fund may count toward the resource limit of $2,000 for an individual or $3,000 for a couple.

Does Interest Earned On Your (And Your Spouse'S) Burial Fund Count As A Resource Or Income For SSI?

No. Interest earned on your (or your spouse's) burial fund that you leave in the fund does not count as a resource or income for SSI and does not affect your SSI benefit.

How Can You Set Up A Burial Fund?

Any account you set up must clearly show that the money is set aside to pay burial expenses. Generally, you can do this by either one of the following:

    titling the account as a burial fund; or signing a statement saying —how much has been set aside for burial expenses, —for whose burial the money is set aside, —how the money has been set aside, and —the date you first considered the money set aside for burial expenses.

What Happens When You Spend Money From A Burial Fund?

If you spend any money from a burial fund on items unrelated to burial expenses, there may be a penalty.



THIS INFORMATION IS GENERAL.
FOR MORE INFORMATION, CALL 1–800–772–1213 (TTY 1–800–325–0778),
VISIT OUR WEBSITE (www.ssa.gov) ON THE INTERNET,
OR CONTACT YOUR LOCAL SOCIAL SECURITY OFFICE.


Sources and publication details

The federal agency source text is U.S. government work in the public domain. Fynoptic selected, adapted, and formatted it for this guide. No agency endorsement is implied. Follow the linked sources for current program details and the rules applicable to your circumstances.

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