What an SNT can Pay For (And what it should Avoid)
In practice, SNTs shine when they elevate daily life: reliable transportation, specialized therapies, private caregiving, dental/vision not covered by Medicaid, adaptive tech, education, hobbies, travel with a companion, and professional services.
To preserve SSI cash benefits, trustees should avoid—or carefully structure—payments that count as In-Kind Support and Maintenance (ISM) (food and shelter). Sometimes a small SSI reduction is worth it; other times we fund ABLE (Achieving a Better Life Experience) accounts to purchase certain items directly. We’ll give you a written distribution guide so the trustee knows exactly how to proceed.
What Is In-Kind Support And Maintenance (ISM)?
ISM is the Social Security Administration’s term for food or shelter that someone else pays for (including a trust). SSI is a needs-based cash benefit; if the program sees your beneficiary getting food or housing in-kind, it assumes they “need” less cash and reduces their monthly SSI. Medicaid eligibility usually follows SSI, so we try to avoid unnecessary ISM hits.
In plain English: if an SNT pays the rent, mortgage, property taxes, utilities, or groceries, SSA can cut the beneficiary’s SSI for that month. The reduction is based on SSA rules and is capped—either the “value of the one-third reduction” (VTR) or the “presumed maximum value” (PMV), whichever applies—but it’s still money lost every month you trigger it.
Why ISM Causes Problems
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Reduced Cash Flow: Less SSI means less flexible money for the beneficiary.
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Administrative Friction: ISM makes reviews with SSA/Medicaid more complex and increases the chance of mistakes.
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Budget Instability: Repeated ISM can upset carefully planned care budgets, especially in supported housing.
What Counts As ISM (And What Doesn’t)
Counts As ISM (Food/Shelter):
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Rent or mortgage payments, property taxes, and homeowner/renter’s insurance if required by the lease or mortgage
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Utilities (electric, gas, water, sewer, trash), heating fuel
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Groceries or meal plans
Does Not Count As ISM (Typically Safe):
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Phone, internet, cable/streaming, cell plans
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Transportation (car purchase/repairs/insurance, rideshare, paratransit)
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Medical/dental/vision not covered by Medicaid, therapies, caregivers
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Education, job coaching, adaptive technology, clothing, furnishings, travel with a companion
(Nuances exist; we train trustees to document and ask before doing anything unusual.)
How SSI Calculates the Reduction
SSA generally uses two guardrails:
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VTR (One-Third Reduction): If the beneficiary lives in someone else’s household and doesn’t pay a fair share of total household costs, SSI may reduce by about one-third of the federal rate.
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PMV (Presumed Maximum Value): If a third party (like an SNT) pays for some food/shelter items, SSI will reduce the benefit by up to the presumed maximum value (roughly one-third of the federal rate, plus a small general exclusion), or by the actual value of what was provided—whichever is less.
You don’t need the exact dollar to plan well—just know the hit is capped, but repeating it month after month adds up.
Practical Ways To Avoid Or Minimize ISM
1) Use A Written Rental Agreement At “Fair Share.”
If the beneficiary lives with family, create a simple, month-to-month room-and-board agreement at a fair market rate. The beneficiary pays their share from their own SSI; the SNT covers non-ISM extras (phone, internet, transportation, furnishings, clothing, therapies). This shows SSA the beneficiary isn’t getting free shelter.
2) Pay Vendors For “Safe” Items, Not For Food/Shelter.
Have the trust pay directly for permitted goods and services (phones, therapy, transportation, adaptive tech). Avoid reimbursing the beneficiary in cash.
3) Consider An ABLE Account For Certain Expenses.
Distributions for qualified disability expenses from an ABLE account are generally not counted as income for SSI; housing payments from ABLE are allowed but must be timed and documented carefully (if funds sit in the account into the next month, they can count as a resource). We’ll give you a calendarized checklist so you don’t accidentally create a resource issue.
4) If You Must Trigger ISM, Do It Intentionally.
Sometimes paying rent from the trust is worth a predictable, capped SSI reduction (e.g., to stabilize housing). If so, we document the choice, budget the monthly hit, and avoid stacking more ISM (like groceries) in the same month.
5) Keep Receipts, Keep Notes, Keep It Boring.
Trustees should save invoices/receipts and write two lines on every payment: what was paid and why it’s benefits-safe. Boring files make reviews easy and approvals fast.
6) Use Tools That Help You Stay Within Guardrails.
A True Link card (with merchant-category controls) can prevent accidental food/shelter purchases while still giving the beneficiary dignified access for safe spending categories.
A Simple Playbook...
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Pay the beneficiary’s fair share of rent from the beneficiary’s own SSI whenever possible.
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Let the trust pay for non-food/shelter needs: phone, internet, medical/therapies, transportation, education, clothing, furnishings, travel support.
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If housing help is essential, decide in advance whether a small, capped SSI reduction is acceptable and budget for it.
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For ABLE, time housing-related payments so funds don’t carry over as a next-month resource; keep ABLE for frequent, small expenses when helpful.
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Keep receipts and a one-sentence purpose note in the Trustee Playbook. Ask us before doing anything unusual.
