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Is CRUT trust income considered countable income?

#1
California

I am receiving income from a Charitable Remainder Unitrust (CRUT) and i am applying for SSI.
Does SSI consider income from a CRUT to be 'countable income?
 

FlyingRon

Senior Member
#2
It may or may not depending on just how it is set up. It's possible that it is excluded itself as a pooled trust or if it transfers money into a special needs trust for you. You'd be advised to talk to an attorney who can examine the actual trust.
 

HRZ

Senior Member
#4
if the SSI is more valuable than the CRUT income it might be wise to review surrender options with a pro who understands the details
 
#5
While i am not familar with 'surrender options', i do not think they would be applicable, in this case, since the terms of the trust docuiment can not be deviated from at all.

I asked this same question elsewhere and an attorney told me that SSI will consider my meager income from the CRUT as 'countable income'
 
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#7
It is likely that SSI would consider this to be countable income if the trust is an excluded resource. If funds are distributed in cash, then they are counted dollar for dollar. If funds are distributed to pay food or shelter bills, then they are considered in-kind income subject to the cap (called the Presumed Maximum Value). If fund are distributed to directly pay non-food and non-shelter bills, then they are not income. The first S in SSI stands for Supplemental. The purpose of SSI is to 'supplement' other income sources.
 

HRZ

Senior Member
#9
If a small amount of CRUT income kills off SSI I invite you to get an accurate read of exactly what is mandated by the CRUT ...IF the trust does not expressly prohibit acceleration of the remainder to the final holder it may be possible to hand it to next in line ....it's not a rare issue ...and details matter. The end charity might help with some useful suggestions ...
 
#10
A CRUT, by definition, could not accelerate the remainder to
the final holder. The current beneficiary, or beneficiaries, are
required to receive the income until they die, after which the
the charitable organization(s) designated in the trust documents
will receive the remainder.

There are very strict requirements that
a CRUT has to adhere to in order to retain it' s tax exempt status but, unfortunately,
many of the employees at the banks that serve as trustees of a CRUT
are often so unfamiliar with the trust laws governing CRUTs, that if
the IRS did have the time to audit most CRUTs many of them would lose their
tax exempt status.

However, if there was a way to get on SSI, i would still get to keep
the exact same amount of my income as i do now.
That is due to the fact that the organization subsidizing my rent
permits everyone in their program to keep exactly $134 of their income,
no matter how much their income is.

However, if, instead of living in an assisted living facility, as i am, someone
was living in an apartment, then this same organization permits the
person to keep 1/3 of their income, and the organiztion subsidizes the rest
of the rent.
 

HRZ

Senior Member
#11
I'm not sure about that and apparently too much income from a CRUT is not entirely rare as to causing problems with other benefits. Other sites discuss full or partial surrender..not of the trust itself but of the income stream .....beyond me except to say dig harder IF a small change in CRUT income might allow a bigger improvement in some other income stream.
 

HRZ

Senior Member
#13
THe OP does not own the CRUT and under the convoluted rules of SS there may be no resource to transfer that OP owns .THe right to income is not ownership of the asset itself . .

AS an important aside, OP has not indicated if a change in CRUT income alters his SSI n a useful manner ...we may be beating on a horse not even in the race?