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Dimitry K., Esq.
Dimitry K., Esq., Attorney
Category: Legal
Satisfied Customers: 41220
Experience:  Multiple jurisdictions, specialize in business/contract disputes, estate creation and administration.
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My aunt has been receiving SSI, she is 93. Because she has

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My aunt has been receiving SSI, she is 93. Because she has no income other than this, my mom and her other sister bought funeral insurance for her, which is now valued at approximately $6000. Recently, my aunt was notified that because she has this insurance, she is no longer eligible to receive SSI and she must now pay back $2500 by June 20.
The question...what should she do? She pays rent and cannot survive without SSI. Can she cancel the insurance and be reinstated? She did not buy it, by the way. My mom and other aunt did so there woudl be money to bury her when the time comes.

Thank you for your question. Please permit me to assist you with your concerns.

I am genuinely sorry to hear that your aunt was put in this situation. Even if this was bought for her, it is still ostensibly an asset that becomes hers, even if via gift. In that situation she must provide evidence that this is an asset she no longer has and still pay back the funds. The reason she has to do both is because she is 'paying back' money that the agency believes they overpaid--simply cancelling the policy will not change that deficiency. But cancelling it going forward will no longer create this overage for her.

Hope that helps.

Customer: replied 3 years ago.

Once she cancels the insurance and provides proof, does she have to reapply for SSI again or will she automatically be reinstated?

Additionally, if there is any overage from the insurance proceeds after paying off the remainder of what she owes SSI, how should she dispose of it so that she is SSI eligible again? What she would like to do is to put it away for funeral expenses, but it doesn't sound like she can put it in a bank account under her name or it would count against her. She has no other income other than SSI.

Thank you for your follow-up, Christina.

If she is already terminated, she would need to reapply. What she can do, however, is contact the SS office directly, and potentially appear in person (if she can), provide evidence that the police was cut off and that she is in compliance. The representatives there have the ability to reinstate. She can have some overage--SSI does have a limitation what can be earned without penalty. Please go to the link below for an SSI pamphlet on the subject:

Good luck.

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