This issue of The Voice, the e-mail newsletter of The Special Needs Alliance, was written by SNA member Raymon B. Harvey, Esq., an AV-rated sole practitioner in Little Rock, Arkansas. You can read more about Mr. Harvey, and his practice, at his office’s website, which provides additional information about Special Needs Trusts and related issues such as Guardianship and Conservatorship, Medicaid eligibility, and other topics of concern to those with disabilities and their caretaker families.
Introduction
Starting last month the Treasury began sending economic stimulus payments to more than 130 million households. Eligible people will receive up to $600 ($1,200 for married couples), and parents will receive an additional $300 for each eligible child younger than 17. You must have filed a tax return in order to receive a stimulus check.
Additionally, at midnight on February 17, 2009, all full-power television stations in the United States will stop broadcasting in analog and switch to 100% digital broadcasting. A converter box will be required to receive broadcasts unless you have cable or satellite. Congress created the TV Converter Box Coupon Program for households wishing to keep using their analog TV sets after February 17, 2009. The Program allows U.S. households to obtain up to two coupons, each worth $40, that can be applied toward the cost of eligible converter boxes.
How will receiving a stimulus check or coupon for a converter box affect your Medicaid or SSI Benefits?
The Centers for Medicare and Medicaid Services (CMS) recently issued guidance concerning the economic stimulus tax rebates and the digital television convert box coupons.
The economic stimulus tax rebates are not counted as income or resources under Medicaid, although the amount of time the rebates are not counted as resources is limited. The legislation (P.L. 110-185) provides that credits or refunds issued under the bill are not to be counted as income or resources in the month of receipt, and for the following two (2) months, for purposes of determining eligibility for or the amount of benefits under any federal program, or under any state or local program financed in whole or in part with federal funds, such as Medicaid and SSI.
With regard to transfers of assets for less than fair market value, rebates given away during the three month period in which they are not countable as income or resources would be subject to a transfer penalty. However, if given away after the three month exempt period expires, the rebates would be subject to penalty.
What about the converter box coupons?
The Department of Commerce is planning to send “coupons” worth $40 each to households for the purpose of helping to defray the cost of purchasing television digital converter boxes. The boxes will be needed by people who do not have digital television receivers when television signals are no long broadcast in analog format beginning in 2009.
The coupon the Department of Commerce is distributing is actually a form of credit card, each worth $40. A person would take his or her coupon to a retailer and exchange it for a converter box. If the converter box costs more than $40, the person would pay only the difference.
According to Commerce, there is nothing else a person can do with this coupon except buy a converter box. The coupon cannot be converted to cash at a bank, for example, or used to buy anything else. That means the $40 coupons would not be considered income under Medicaid. For Medicaid, income is broadly defined as anything a person receives that can be used to purchase food or shelter. Since the coupons can only be used to purchase a converter box, the coupons do not meet the Medicaid definition of income. Since Medicaid uses the SSI definition of income, the coupons would not count as income for SSI purposes, either.
About this Article: We hope you find this article informative, but it is not legal advice. You should consult your own attorney, who can review your specific situation and account for variations in state law and local practices. Laws and regulations are constantly changing, so the longer it has been since an article was written, the greater the likelihood that the article might be out of date. SNA members focus on this complex, evolving area of law. To locate a member in your state, visit Find an Attorney.
Requirements for Reproducing this Article: The above article may be reprinted only if it appears unmodified, including both the author description above the title and the “About this Article” paragraph immediately following the article, accompanied by the following statement: “Reprinted with permission of the Special Needs Alliance – www.specialneedsalliance.org