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Lev, Tax Preparer
Category: Finance
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Experience:  Personal Investment, Tax Preparation
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I received a class-action settlement check & I get SSI

Customer Question

I am blind and I get SSI Social Security. I am not on SSDI I am on SSI only. Today I received a check in the mail for $7,000 part of a class action lawsuit settlement against Target stores. it is a one time check. Question is in my allowed to spend that money on whatever I wanted such as paying credit card debt or buying a new bed. how many days do I have to spend this money. what is my best way of keeping my full SSI checks every month. Due to the fact that I got this money. I really do not want to lose my SSI or my medical benefits due to receiving the settlement. I know that SSI will make me spend all of the money but exactly what can I spend it on and what are the rules regarding receiving a class-action settlement well on Social Security SSI. I know from reading pamphlets that you're required to report any unearned or earned income to Social Security administration.
Submitted: 7 years ago.
Category: Finance
Expert:  Lev replied 7 years ago.


because you receive benefits that are need based - such benefits will be affected if you have additional income.

These are your money and you may spend them as you wish.

HERE is the information how additional income affect SSI benefits.


The money you receive is considered income for the month you receive it and could make you ineligible for that month, depending on the amount.

If you keep the money into the next month, it then becomes a part of your resources. An individual cannot have more than $2,000 in resources to remain eligible.

Call Social Security at 1-800-772-1213 and report the income (TTY number, 1-800-325-0778) . They will tell you how your eligibility will be affected and what you can do to remain eligible.


Let me know if you need any help.


Customer: replied 7 years ago.
Do I have to show receipts for items that I purchased equaling the $7,000? example $60.00 for shoes, $1,500 for computer. Do I have to spend all of the money during the month that I received the check. say if I got the check on June 1 I must spend that by June 30, 2009. in my able to use this money to go on a vacation. am I able to keep below 1,000 of it in saving. I understand about the total of $2,000 in the bank account at one time. but I will be over for this month because I got this check. so would it be a wise idea to set $1000 of it aside so that I'm able to pay my bills next month just in case they cut me for the following month. will I lose my medical benefits for the month that they cut my cash aid. or is that just I have to pay it back during the following month? Can I spend the money on whatever I want as long as I have receipts to show proof that I spent all the money below 1,000.
Expert:  Lev replied 7 years ago.

I do not think that receipts are required, but it would be wise to keep receipts just in case.

If you received the income in June - it is counted as income received in June and will affect your SSI in June.


All money that you would not spend by June 30 - will be counted as your assets in July.

It doesn't matter if you keep them in the bank or as cash in your pocket.

As long as your total countable assets are below $2000 - your July SSI will not be affected.


Customer: replied 7 years ago.
question I got my SSI check for June on June 1 I should be getting the settlement check in about another four days which should be the 6 day of this month so I have until the end of this month to spend the $7,000 that I got out of that settlement right? they will probably make me pay back the money for this month probably next month correct since I received the money for this month.
Do you know if I will lose my medical for a month?
Expert:  Lev replied 7 years ago.

Yes - you are correct - an additional income in June will affect your eligibility and if you already received SSI benefits - you might be required to pay them back or your future benefits will be reduced by the amount you owe.

Your Medical benefits might be affected if they are need based.

I do not think that you will loose eligibility, but might be required to pay part of premium for that month.

To determine the amount - you would need to contact SSA in your local office.


Customer: replied 7 years ago.
please advise me one more time I am able to spend a $7000 on anything I choose as long as it is completely spent by the end of this month right?
Expert:  Lev replied 7 years ago.

Yes - these are your money - and you may use them as you want.

However - if you use the money to purchase some items - they might be counted as your resources.

Resources are the things you own such as cash, real estate, personal belongings, bank accounts, stocks and bonds that you can use for your support.


To be eligible for SSI a person must have $2,000 or less in countable resources. If you own resources over the SSI limit, you may be able to get SSI benefits while trying to sell the resources.


Not all of your resources count toward the SSI resource limit. For example:

  • the home you live in and the land it's on do not count.
  • your personal effects and household goods do not count.
  • life insurance policies may not count, depending on their value.
  • your car usually does not count.
  • burial plots for you and members of your immediate family do not count.
  • up to $1,500 in burial funds for you.
  • if you are blind or have a disability, some items may not count if you plan to use them to work or earn extra income.

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