Dealing with the 'Marriage Trap'

Marriage should be a happy celebration of two lives coming together, but for people with special needs, marriage can sometimes cause additional stress beyond the usual pre-wedding jitters.

That's because people who receive certain government benefits may be penalized for getting married and living with their spouses.

SSI Benefits and Marriage

Single recipients of Supplemental Security Income (SSI) typically face the most significant challenges when they choose to get married, due to the Social Security Administration's arcane "deeming" rules.

A single SSI recipient is allowed to only keep up to $2,000 in their name, and their monthly income must be very low. But when an SSI recipient marries, their new spouse's resources are added to their own for purposes of determining SSI eligibility (this process is known as "deeming"). If the couple's combined assets are worth more than $3,000, the SSI recipient will no longer qualify for benefits.

Likewise, an SSI recipient's spouse's income is added to their own income using a very complicated formula that depends, in part, on the number of children in the family. If the couple's combined income is too high, the SSI recipient loses their benefit.

Medicaid and Marraige

Medicaid, which often accompanies SSI, is another means-tested benefit that could be affected by marriage. However, some community-based Medicaid programs are a little more lenient than SSI when it comes to spousal resources, allowing the spouse of a Medicaid recipient to have additional assets without penalizing the recipient.

Because individual Medicaid programs differ, you will need to consult with a special needs planner to determine if marriage could alter your benefits.

SSDI May Also Be Affected

People who receive Social Security Disability Insurance (SSDI) payments may assume that tying the knot won't affect their benefits because this particular program does not have an unearned income limit or an asset restriction. They are correct so long as they are receiving SSDI benefits because of credits that they earned on their own work records.

However, some people who have disabilities that developed while they were young receive SSDI payments when a parent dies or retires, even if the child hasn't worked for enough quarters to qualify for benefits on their own. In those cases, marriage to someone who is not receiving Social Security benefits could terminate SSDI benefits for the spouse with the disability.

If a person receiving disability benefits marries and retains their SSI or Medicaid benefits, they and their spouse will still have to consider a host of estate planning problems that crop up upon marriage.

For starters, the couple will need to work with a special needs planner to develop wills and possibly trusts that will hold assets for the survivor without compromising access to government benefits. (Married couples without an appropriate estate plan are especially vulnerable to problems because state laws dictate where assets go when a person dies without a will. If the spouse with a disability receives an inheritance in this manner, it could ruin her ability to maintain eligibility for benefits.)

Couples will also have to contend with elaborate estate recovery laws designed to recover funds from a Medicaid recipient's estate, often at the expense of the surviving spouse.

The issues surrounding marriage should not deter someone with a disability from choosing to marry. However, careful planning is required to ensure that marriage won't create additional hardships. A qualified special needs planner in your area can help you address the "marriage trap" ahead of time so that you can enjoy your special day and your future together.