Are College 529 Plans Considered a Resource by Social Security

When Applying For SSI?

Recently the issue of whether or not a College 529 plan would be

counted as a resource of the disabled person by Social Security
when applying for Supplemental Security Income (SSI) came up
in our office.

The answer depends on whether the disabled person applying for

SSI is over or under the age 18.

If a disabled person is over age 18, their 529 plans are excluded by the SSI
program through several different provisions. First of all, the accounts are held
by their parents or other persons who make the contributions. While the student
is named as the beneficiary, these accounts are owned by others and thus would
not count as a resource to the student. If the student is over the age of 18, the
529 Accounts held by parents or other persons would have no bearing on the
student's SSI eligibility.

For any child under the age of 18, who is applying for SSI, his/her parents'
income and resources are counted as belonging to that child. Therefore, a 529
Plan Account would be considered a "countable parental resource." If the value
of the 529 Account exceeds $3,000 (a couple's resource limit for SSI eligibility),
the child would then be ineligible for SSI.

For more information on eligibility for Social Security Disability and SSI benefits,
please click here.