does my settlement money affect section 8

Most settlement income is not counted in the Section 8 income calculations. So long as it is for a personal loss (injury or the like) or a property loss, it should not be included, unless it is disability or unemployment money. Attached is the HUD page describing this.

Full Answer

Do lump sum payments count as income for Section 8?

Lump sum payments that an individual receives in lieu of regular earnings, such as unemployment, worker’s compensation, and severance pay, are counted as annual income and affect both Section 8 eligibility and a recipient’s TTP in exactly the same way as income derived from assets. 12

How does an asset affect Section 8 eligibility?

8 A family’s Section 8 eligibility is affected only if income earned from the asset places the family over 80% of the area median income. A family’s total tenant payment will increase by 30% of the income derived from the asset. In other words, income from an asset is treated exactly the same as employment wages.

Will a lawsuit settlement affect my Social Security benefits?

If you are receiving government benefits such as Medicaid, Section 8 or another form of Public Housing, Supplemental Security Income (SSI) or Social Security Disability (SSD) and are expecting a lawsuit settlement, you should be aware of the impacts of the settlement on your benefits.

How much do you have to pay for Section 8 housing?

With a Section 8 voucher, a family must typically contribute 30% of its adjusted annual income toward rent each year. 3 This is called the total tenant payment (TTP).

1 attorney answer

You will not automatically lose your Section 8 due to the settlement of your personal injury case against your landlord. However, this is a question you are going to have to ask whatever housing authority administers your Section 8 voucher.

Jon W. E. Rockwood

You will not automatically lose your Section 8 due to the settlement of your personal injury case against your landlord. However, this is a question you are going to have to ask whatever housing authority administers your Section 8 voucher.

What happens if you receive SSI?

But, if you receive any of the following needs-based benefits, your settlement may affect your eligibility and could cause a lapse or termination of your benefits: SSI (Supplemental Security Income): A cash benefit that provides assistance to the aged, blind or disabled.

How long does it take to report a settlement?

Please note that you must report any settlement you receive to your caseworker within 10 days of receiving the funds.

Can you lose your medical benefits if you receive a settlement?

Many public assistance programs that provide you with monthly income or payments for medical services have strict financial eligibility limits. Without careful planning, your settlement award may cause you a reduction or even loss of your benefits for a period of time.

Can you lose your SSI if you give away part of your settlement?

You will likely lose your needs-based public assistance benefits for a period of time if you accept a lump sum payment that causes you to exceed the program’s income and resource limits. Likewise, if you give away part of your settlement as a gift or donation, you could also lose your SSI and/or Medicaid benefits for at least a time. Or, the government could seek reimbursement for benefits you’ve received.

What is the income requirement for Section 8?

To be eligible for the Section 8 voucher program, a family’s gross annual income must be less than 80% of the area median income. 1 Each Public Housing Authority (PHA), the local agency that administers the Section 8 program, must adopt preferences for families who earn at or below 30% of the area median income and target these families for priority admission to the program. 2

What is Section 8 voucher?

Section 8 vouchers are a federally-funded type of public housing assistance that subsidizes the cost of private market rentals. They are a lifeline for the families fortunate enough to obtain them and often present the only means of finding affordable housing. This article will discuss how a family’s income and assets, including lump sum awards, ...

How is Section 8 TTP determined?

Unlike other public benefits programs, Section 8 eligibility and a recipient’s TTP is determined almost exclusively by a family’s income, including income derived from assets, and not by the cash value of the total sum of the family’s assets. With the right planning, individuals and families can build their assets and plan for ...

How much does a tenant's total tenant payment increase?

A family’s total tenant payment will increase by 30% of the income derived from the asset. In other words, income from an asset is treated exactly the same as employment wages. PHAs will not take into account the value of the actual asset; if the family does not receive any income, it will not affect the Section 8 voucher.

Do you have to have assets to be in Section 8?

Families seeking admission to the Section 8 program do not have to comply with any general limitation on the amount and type of assets they can own. However, a portion of a family’s assets will count toward the "annual income" determination and, in some circumstances, may affect eligibility and total tenant payment. 7

Does a lump sum award count as income?

10 If the lump sum award falls within one of these categories, no portion of the payment counts toward annual income. The result is different, however, if the family disposes of the lump sum award for less than fair market value. In this case, the family will automatically have to count a percentage of the lump sum asset as annual income for 2 years following the transfer, determined by the HUD passbook savings rate. 11

What is a spend down payment for Medicaid?

A “spend-down” means that the award recipient, like Mark, must spend all of the award proceeds on exempt items in the month the settlement check is received. It is important to note that, had Mark really received a settlement award on May 30th– he would only have two days to spend the entire sum if he doesn’t want to be ineligible for Medicaid! This is the law because although in May the settlement award is counted as income, the following month it is counted as a resource. Exempt items include one vehicle, money spent on a personal residence, as well as all of the bills itemized above in the Pooled Trust option.

Can a settlement reduce your government benefits?

Generally speaking, if your benefits depend on your income and/or resources, a settlement award will reduce or eliminate the amount of your government benefits unless you either set up a Trust with the help of a qualified attorney or engage in a “spend-down,” likewise with the help of a knowledgeable lawyer. If your government benefits are not ...

Is a settlement award counted as income in May?

This is the law because although in May the settlement award is counted as income, the following month it is counted as a resource. Exempt items include one vehicle, money spent on a personal residence, as well as all of the bills itemized above in the Pooled Trust option.

Does Medicaid count as income in a lawsuit?

If a young, non-disabled individual in receipt of Medicaid benefits is about to receive an award from a lawsuit, Medicaid will count the award/settlement as income in the month it is received.

What is Section 8 housing assistance?

If your client has housing assistance through the U.S. Department of Housing & Urban Development (HUD), which includes Section 8 benefits, it is critical from a planning perspective to understand how those benefits work. Not understanding the federal program and the nuances of your client’s local program could result in a variety of issues from inconvenience to your client to loss of a benefit he or she desperately needs.

How does the housing authority determine the amount of a voucher?

The local housing authority determines the amount of the voucher based on the above factors and the cost of rent in the local housing market. It is then up to the voucher recipient to find a suitable dwelling for that price (if the rent is higher than the voucher, the recipient pays the excess). The recipient will likely also pay 30-40% of monthly adjusted income.

How does HUD affect special needs trusts?

HUD benefits add a layer of complexity to special needs trust administration due to both the rules and the inconsistent way in which they are applied. Special needs trusts, whether pooled or standalone, must follow certain rules to ensure their beneficiaries do not lose the public benefits. One such rule is that the trust be used only to supplement but not replace or supplant those benefits. In practicality, this means Trustees apply categorical prohibitions. For example, if a beneficiary has SSI, a Trustee may not pay for food or shelter expenses. This is relatively straightforward and simple from an administration perspective.

Why did the Housing Authority rule cite above allowing trust distributions to be counted?

The housing authority’s argument boiled down to an assertion that had the funds gone straight to the beneficiary’s bank account they would have been excluded from income. Because the funds went to an irrevocable trust, they triggered the rule cited above allowing trust distributions to be counted.

Can Section 8 vouchers be counted as income?

For a beneficiary with Section 8 vouchers, any regularly-occurring distribution could be counted as income while “sporadic” distributions are excluded. Navigating this rule has created a “best practice” of distributing funds irregularly. This can be achieved by only paying for one-time purchases as opposed to purchases that occur every month such as a cable or cell phone bill. Depending on the nature of the expense, creative solutions can sometimes be utilized such as paying ahead a few months on a bill (varying the number of months each time). Another option is making distributions to an ABLE account. These decisions must be made on a case-by-case basis in full consideration of the beneficiary’s other benefits.

What type of programs are affected by lump sum settlements?

Here are the types of programs that could be affected by accepting a lump sum settlement: Medicaid (Medi-Cal in California): A joint state and federal program that provides medical coverage for low-income individuals and families.

What is subsidized housing?

Subsidized Housing: Assists with the cost of housing and rent; sometimes referred to as HUD and/or Section 8 housing.

What is Social Security retirement income?

Social Security Retirement Income: Provides Social Security retirement benefits for a United States tax­payer who was covered under Social Security and who received credits for their previous employment record.

Can a settlement be eaten up?

Some may assume that the acceptance of a settlement precludes an individual from needing government assistance. In reality, the financial impact of an injury can be devastating, and even a multi-million dollar settlement can be eaten up quickly by the cost of medical equipment, medications, physical therapy, adaptable vehicles and home modifications, attendant care, and more.

Is an entitlement benefit affected by a lump sum settlement?

Unlike needs-based benefits, entitlement benefits do not have income tests nor asset tests to determine eligibility. As a result, they should not be affected by the acceptance of a lump sum settlement. Here are some examples of entitlement benefits:

What are the problems with Section 8?

There are a lot of bed bugs and roaches in a lot of these section 8 places and the crime is going up too which includes drug activity, public intoxication, fights, and assaults. To curb some of this, many section 8 places ban alcohol and drugs on the premesis. With the drugs many were bold enough to do it right in their apartments and they did this by disabling the fire alarms in their rooms. Section 8 got hip to the battery popping and installed new fire alarms in the units that will sense someone tampering with the fire alarms and will alert the front desk. They have this control box in the lobby where the sign in lady is for visitors which will go off and light up the room where the tenant is tampering with the device. They go upstairs to investigate and oftentimes smell the person doing the drugs from their rooms and then they call the police. These are the few disadvantages.

What to do if you have not inherited money?

If you have not inherited the money because the grantor is still alive, have the grantor seek an estate planning lawyer, because the inheritance can be placed in a trust that does not affect your Section 8 qualification.

Can a welfare agency take money from you?

No. And it's possible they will take that money from you for back pay. And if you manage to get that money before they find out. (Hard to do today. Because Attorneys have searchers) and will take it right off the top of your inheritance. The laws were changed on Welfare benifits. 5 years max. And you owe them the money. Go on the website. And look up what your rules are in your State. .gov will be part of the address. And you can scroll untill you find what you need.

Does Section 8 adjust rent?

Your Husband’s income gets tabulated to yours, and Section 8 will adjust your share of the rent, if you still qualify for Section 8.

Do you want to live in section 8 housing if you inherited $500,000?

Let say you inherited $10,000 and they give you a check. If you don’t open your big mouth, nobody will know. $10,000 is not a big sum and won’t change your life much. So 100% you will keep quiet and stay in section 8 housing for now.

Do landlords get Section 8?

It sounds like a lot to learn, but it’s do-able! If a landlord knows how to work with Section 8, it can be a really beautiful thing for us landlords to receive rental checks every month from the government (HUD is the oversight body), even during Coronavirus. At least we get paid that money for rent.

What happens if a Section 8(i) settlement is disapproved?

Where a Section 8(i) settlement application is disapproved by the deputy commissioner, any party to the settlement may request a hearing before an administrative law judge or submit an amended application to the deputy commissioner. 20 C.F.R. §702.243(c). Accordingly, this case was properly forwarded to the administrative law judge once the settlement was disapproved by the deputy commissioner. However, the administrative law judge erred in finding the settlement should have been deemed approved as the application did not comply with the regulations.. Although a claims adjuster for employer did sign the portion of the settlement application regarding the settlement of the disability claim, his failure to sign the portion of the settlement application which dealt with settlement of the medical benefits renders the entire settlement application incomplete; under 20 C.F.R. §702.243(e), if either portion of a combined compensation and medical benefit settlement is disapproved, the entire application is disapproved unless the parties indicate on the face of the application that they agree to settle each portion independently. McPherson v. Nat’l Steel & Shipbuilding Co., 24 BRBS 224 (1991), aff’d on recon. en banc, 26 BRBS 71 (1992).

What is Section 8(i)?

Section 8(i) provides the requirements for the settlement of claims under the Act. This provision was substantially amended by the 1984 Amendments, following which the Department of Labor promulgated new regulations, effective January 31, 1986. 20 C.F.R.

What to do if a settlement is disapproved?

If the proposed settlement is disapproved by the district director, the parties may either request a hearing before an administrative law judge or submit an amended settlement application. 20 C.F.R. §702.243(c). If the administrative law judge disapproves a settlement following a hearing, the parties have the option to submit a new application, file an appeal to the Board, or proceed with a hearing on the merits of the claim. Id. If the settlement is initially disapproved by the administrative law judge, the parties may either submit a new application or proceed with a hearing on the merits. Id. The district director or administrative law judge must explain the reasons for rejecting a settlement agreement with sufficient particularity so as to allow a proper review of his determination. Sablowski v. Gen. Dynamics Corp., 10 BRBS 1033 (1979); see 20 C.F.R. §702.243(c).

What is Section 14(f) in a settlement?

In a case where employer paid the 20 percent penalty under Section 14(f), giving the Board jurisdiction over the appeal, the Board held that the parties may negotiate claimant’s entitlement to or waiver of a Section 14(f) assessment in a Section 8(i) settlement, as the assessment is additional compensation and claimants may waive their rights to compensation through a Section 8(i) settlement. In this case, claimant and employer entered into a Section 8(i) settlement which provided for claimant’s waiver of the Section 14(f) assessment in the event he did not provide a “valid street address for purposes of delivery of the settlement proceeds.” Claimant supplied his correct street address but the USPS refused delivery because claimant did not have a mailbox at that address. Consequently, delivery of the proceeds was late. Because the district director did not address employer’s argument that claimant violated the settlement clause, the Board vacated the Section 14(f) assessment and remanded the case to the OALJ for fact-finding on this issue. D.G. [Graham] v. Cascade Gen., Inc., 42 BRBS 77 (2008).

Which court case referred to the authority of the deputy commissioner to approve settlements?

In Clefstad v. Perini North River Associates, 9 BRBS 217 (1978), the Board held that both deputy commissioners and administrative law judges had the authority to approve proposed settlements under the Section 8(i)(A) of the 1972 Act. The Fifth Circuit, however, held that administrative law judges were not authorized to approve such settlements, but could only recommend approval or disapproval and then remand the case to the deputy commissioner for ultimate approval. Ingalls Shipbuilding Div. Litton Sys., Inc. v. White, 681 F.2d 275, 14 BRBS 988 (5th Cir. 1982). The Board followed White only in cases arising in the Fifth Circuit. In Blake v. Hurlburt Field Billeting Fund, 17 BRBS 14 (1985), which arose in the Eleventh Circuit, the Board reaffirmed its holding that both deputy commissioners and administrative law judges may approve settlements and expressly refused to adopt the Fifth Circuit’s view in White. The Board noted that its determination was consistent with the 1984 Amendments.

Is the deputy commissioner's order a settlement?

The administrative law judge erred in construing the deputy commissioner’s order as a Section 8(i) settlement. The Board noted the order contained no findings regarding whether the compensation awarded was in claimant’s best interests and did not provide for the complete discharge of employer’s liability for payment of compensation. Rather, the order stated that the file will be closed “subject to the limitations of the Act or until further Order of the deputy commissioner.” Thus, it was not a settlement, but must be considered an award based upon the agreements and stipulations of the parties pursuant to 20 C.F.R. §702.315. Such awards are subject to Section 22 modification since they do not provide for the complete discharge of employer’s liability or terminate claimant’s right to benefits. Lawrence v. Toledo Lake Front Docks, 21 BRBS 282 (1988); Stock v. Mgmt. Support Associates, 18 BRBS 50 (1986).

Can a settlement agreement be conditioned?

settlement agreement may be conditioned and restricted, as long as it is in accordance with law. For example, the Board has held that a settlement agreement providing benefits for Section 8(c)(13) permanent partial disability could be made contingent on the end of total disability. Sablowski v. Gen. Dynamics Corp., 10 BRBS 1033 (1979).

The Income and Assets Test For Section 8 Housing

Income

Assets

Lump-Sum Awards

• Whether a lump sum award counts as annual income, and consequently affects Section 8 eligibility and TTP determination, depends on the type of lump sum payment and how the recipient utilizes it. Lump sum additions to a family’s assets, including inheritance, insurance payments, capital gains, and settlement for personal or property loss, are exclud...

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