Retirement Funds Retirement Funds Retirement funds are annuities

Retirement Funds

Retirement Funds • Retirement funds are annuities or workrelated plans for providing income when employment ends (e. g. , pension, disability, or other retirement plans administered by an employer or union).

Retirement Funds • Any Retirement funds including: – Employer Sponsored Retirement Plans – Employment-Related Retirement Plans – Individual Retirement Accounts • Often have special tax status, i. e. . , deferred taxation

If A/R has retirement plans, ask: • Is the owner receiving regular payments, i. e. , a pension benefit? • If not, can they? • If they are not eligible for payments, is any portion of the principal available

Availability of Retirement Benefits • If A/R is receiving periodic payments, these payments are unearned income – A/R must maximize payments or document that payment less than the maximum cannot be changed

Availability of Retirement Benefits, cont • If A/R is eligible for periodic payments, but isn’t receiving them: – A/R must apply for benefits – A/R must choose periodic payments rather than lump sum – A/R must choose maximum amount of payment available – Payments are counted as unearned income

Availability of Principal • If A/R is receiving retirement benefit, the principal is considered unavailable – Can not be counted as a resource – Payments are counted as unearned income

Availability of Principal • If A/R can not receive periodic payments, resource value of principal depends on availability

Availability of Principal, cont’d • If A/R cannot withdraw any funds from the principal, the retirement plan is unavailable – Cannot be counted as resource

Availability of Principal, cont’d • If A/R may withdraw funds – Maximum amount available (less early withdrawal penalties, not including income taxes) is a countable resource

Availability cont’d • A retirement fund is exempt as a resource for SSI-R A/R if: – Owned by the non-applying or ineligible spouse, and – A/R is NOT subject to spousal impoverishment

SSI-Related and Spousal Rules • In Spousal Impoverishment cases: – The pension funds owned by ineligible or non applying CS are used first to determine MCSRA – Any excess is AVAILABLE to Institutionalized Spouse

Documentation of Retirement Funds • SSI-R Applicants who are applying for nursing facility services or CC w/LTC must document: – If asset is a retirement fund – If the A/R is eligible for periodic payments and if so how much and when would they begin – If principal is available and if so, how much; (e. g. is there a penalty or not)

Documentation of Retirement Funds • SSI-R A/R’s who attest to the value of their resources and own a retirement account: – Must pursue regular periodic payments – Must also prove whether or not payments are available to them – If payments are not available and A/R is excess resources they must provide proof of availability of the principal and how much