Your brother already has a problem. The moment that property was sold and he gained a profit from the sale he lost his eligibility for SSI benefits because he exceeded the asset limitation for SSI. Having the money in a check in his name is ***** ***** from having cash and he cannot just put it into a trust (of any kind) to avoid losing his benefits.
Preparations should have been made for the profit before the sale ever took place. At this point all he can do is notify SSI of the sale, and depending on how long the place has been sold, he may have to repay some SSI benefits back.
You wrote: We don't dare touch this check that was issued in my sick brother's name until we find out how to deal with this money. I'm not sure what you mean----but the check is the property of your brother and he must determine what he will do with it. However, he MUST immediately notify his SSI worker about the sale of the property and his money. Keeping it in check form, and not cashing it, is not protecting him. The money is still there---it belongs to him, and he no longer qualifies for SSI benefits or Medicaid.
If he is getting social security benefits of any kind he will keep those. And once the money he has is spent down below the $200 maximum threshold, he can reapply for SSI. But SSI is for certain people with limited assets and income---and your brother has this money now and is no longer lacking in assets. Therefore he no longer qualifies for SSI. There is no work around and his failure to notify SSI of this money he now has is a violation of his obligations under SSI law and he could be charged with a crime if he does not inform SSI of his money.
A disability trust or a special needs trust won't work because those are trusts that would have to be funded by other people with other people's money. Your brother cannot protect the cash by opening up a trust for himself or for anyone else. He is expected to live off the money until he gets back down below $2000 in assets and then he can re-qualify for SSI.
It simply is too late to do any strategic planning. The cash is already in hand and the idea that not cashing the check is somehow avoiding the issue is a false idea. He might as well have the money in hundred dollar bills. He has lost eligibility and needs to report it to avoid possible demands for SSI repayment and even possibly criminal charges.
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