Counting SSI as income on mtg? (loan, real estate, income tax, credit)
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I have a mentally disabled parent that lives with me and I receive her SSI/disability checks as a Representative Payee. While the SSA sends payments and statements in my name and payable to me, I also provide an annual accounting to them showing how I spent the money for housing, food etc. I provide for her needs but don't show this as income on my tax returns because who would pay taxes on disability?
I recently applied for a mtg of 75k on a 260k new house and have current appraisal. I am self employed part time and net about 18k a year (have tax returns) and my parent is a part time job too and I count her SSI. (15k) I can't find anyone that will count her payments to me as income because it is "her money", even though it has never been made payable to her. She has been with me since 2000 and I have provided all paperwork/deposits etc. Prior to this my sibling was her Payee for 20+ years. I was told I had to put my parent on the deed/mtg for her SSI payments to be considered. Impossible.
I am in VT. Has anyone else encountered this and do I have any options? Just don't understand wanting to only borrow 30% of the value. My credit is fine too.
It's not YOUR income to count. It's your parent's income. If you want it to count, they have to be on the loan. No way around that. Lenders look at debt to income ratios. If you personally don't have the income to offset the debts, no mortgage.
It's not YOUR income to count. It's your parent's income. If you want it to count, they have to be on the loan. No way around that. Lenders look at debt to income ratios. If you personally don't have the income to offset the debts, no mortgage.
Very true. And to top it off, SSI is a non-gauranteed benefit not earned by the claimant [the mother]. SSI is given to claimants not insured by the SSDI or SS Retirment program..and thus, the Supplemental Security Income [SSI] benefit can terminate without much notice [for various reasons] or be drastically reduced to 30 dollars should the claimant go into a nursing care or a hospital for more than 30 days. I would suspect that claiming it as your income would be considered a fraudulant inaccuracy on your part.
It's OK peeps. I suppose I claim it as income because it is also disability rolled in. The checks are made payable to me for the last 10 years and 24 years before that to my brother. I provide an annual accounting to the GOV for how much I spent on food,housing and such. In all actuality I am my parents custiodian since they are fully mentally incompetent. If I didn't have to run home all the time to cook, flush toilets, give meds and such I might work more full time. I paid cash for/built my 300k house and just wanted to borrow 28 percent of the value cuz now my kid needs to move back. I was being honest and got slammed. But, I'll be damned if I don't care for my Mom and sign her over to the State. Most people are being screwed over by the economy but I'm not and it's a shame that honest people are being treated like everyone else bleeding the "poor economy" vein. I have had a net income of 32k for the past 10 years and own home/cars outright and??????
Odd that the US govt and even my State govt have no prob counting my earnings as factual.....hard verified copies do work. Yet,banks are so gun-shy due to the "iffy" people. I'll take it as a sign that I don't need the money and I can still own my home outright at mid 40s and have no other debt. Shame on me for wanting to make an addition a little easier. NOT. Shame on the friggin bailout that only made more sheister bankers billionaires. And shame on the people that bought more than they could afford.
I claim it as income because it is also disability rolled in. The checks are made payable to me for the last 10 years and 24 years before that to my brother. I provide an annual accounting to the GOV for how much I spent on food,housing and such. In all actuality I am my parents custiodian since they are fully mentally incompetent. If I didn't have to run home all the time to cook, flush toilets, give meds and such I might work more full time.
That's all good and fine, but being a Rep Payee does not 'entitle' the Rep Payee to the benefits. They purely handle the money as a fiduciary agent for the claimant. You are not being paid the money for doing a 'job' for the claimant. The Rep Payee is making payments [for food,shelter,living expenses,etc] on behalf of a mentally incompetent person.
The accounting form you discuss, form SSA-623, is sent out to see how the Rep Payee used the funds for the claimant in this manner. It's not an audit to see how you handled your money its an audit to demonstrate how the rep payee handled the claimant's money. I should know as I audited people's SSI/SSDI and so on.
Either way, if you can make it work for you in purchasing a home, more power to you.
just because the check comes to you...its NOT YOUR MONEY...the money is your mothers...it is not a pay check to take care of her, its not a 'hey thanks heres some cash"
its not YOUR income, if it was you woudlnt have to tell the govt how your spending it...
if your mothers name was on the loan then HER disability money would count as income for HER...
but otherwise you simply cannot use someone elses money as a basis for your mortgage simply because it comes to your name, it comes to you because social security feel she is incapable of making correct descisions for the money herself.
that money the govt provides you is not only to pay for her food (it should not be paying for yours or anyone else in your houses food) her electricity share, her "rent"...its not supposed to be paying your bills, but her portion of the bills for living with you.
part of that money is supposed to go on hiring/paying for a health assitant if your mother is totally incapable of caring for herself during the day while your working. this is why there are care allounces to adult children taking care of their parents...the money comming in right now is not your carers allowance...not a wage for looking after her ect.
sorry its the way it goes...
it would be like my parents trying to claim my income for a mortgage simply because i live with them....
the way around it...put her on as a co-signer..however being shes aparently completly mentally unsound its likely they wouldnt allow it either...
the other option, head down to social security and put in a claim for a care allowance to make up for your lost wages by haivng to be there for her during the day...
they will either give you a wage to look after her, or will help find an actual worker who will do all that during the day for her.
this is what my mother does for her career, social security pays a company that hires home care workers and home care nurses, that company sends these people in to care for people incapable of properly caring for themselves...even if they do live with family.
That's all good and fine, but being a Rep Payee does not 'entitle' the Rep Payee to the benefits. They purely handle the money as a fiduciary agent for the claimant. You are not being paid the money for doing a 'job' for the claimant. The Rep Payee is making payments [for food,shelter,living expenses,etc] on behalf of a mentally incompetent person.
The accounting form you discuss, form SSA-623, is sent out to see how the Rep Payee used the funds for the claimant in this manner. It's not an audit to see how you handled your money its an audit to demonstrate how the rep payee handled the claimant's money. I should know as I audited people's SSI/SSDI and so on.
Either way, if you can make it work for you in purchasing a home, more power to you.
Ok I will ask YOU this. (I already own my home as in paid cash a long time ago). I'm not looking to cash in on my Moms money, as she lives quite well and doesn't lift a finger for a single thing.
With my state I have to show any income that I receive and for the past 10 years I have counted the $1000 a month that I paid myself as my income. Was that in error? I am not at all trying to be a shyster but which one is in error? What I did the past 10 years and what my brother did for two decades before? I also followed advice of accountant. Has everyone been wrong for 3 decades? Was the money I paid myself to provide for all aspects of her life income to me or not???? Just a simple question.
I don't care why people want to attack and start judging me for dealing with a handicap with no help from a soul. It is irrelevant and totally impertinent for my question. If I honest to goodness knew, then why the hell would I ask?
were not 'attaking" you for helping your handicaped mother, simply telling you why you cant claim her money as your own...it seems from your posts that you feel because your name is on that check its all your money to do what you like with...the mortgage company (and the posters here) are simply telling you thats just not true...just cause your names on the check doesnt mean the money is your income...
as for the $1000 a month your paying yourself to look after her...
if it is itemized on the forms your sending back as a carer allowance then it would count as your income and is therefore taxable, you could also use that $1000 as income towards your income for mortgage purposes, however it MUST be properly documented that that is where that money is going...simply keeping $1000 back out of her money for yourself and not properly itemizing it means its not realy yours, just her money that 'she" hasnt spent yet...
personally id talk to her social security agent and see how you go about making that money your paying yourself LEGALLY yours as a carers allowance and therefore making it legally your money....
and if your not documenting it on her forms as a carers allowance/payment to you then you shouldnt be paying taxes on it, because in that case its not realy yours...i hope that makes sense...
right now, being its not counted i think its safe to say your just keeping that extra cahs back and not declaring it properly...so your currently getting taxed on something that...in all definaition...isnt realy yours...and your mother will be getting taxed on that money too...(yes the disabled are also expected to pay taxes...)
Ok I will ask YOU this. (I already own my home as in paid cash a long time ago). I'm not looking to cash in on my Moms money, as she lives quite well and doesn't lift a finger for a single thing.
With my state I have to show any income that I receive and for the past 10 years I have counted the $1000 a month that I paid myself as my income. Was that in error? I am not at all trying to be a shyster but which one is in error? What I did the past 10 years and what my brother did for two decades before? I also followed advice of accountant. Has everyone been wrong for 3 decades? Was the money I paid myself to provide for all aspects of her life income to me or not???? Just a simple question.
I don't care why people want to attack and start judging me for dealing with a handicap with no help from a soul. It is irrelevant and totally impertinent for my question. If I honest to goodness knew, then why the hell would I ask?
First, there's no need to speak condescendingly or ask with the word hell in it. Secondly, you've succesfully derailed this thread into what it's not - a mortgage question in the real estate forum.
But you asked me a legit question so I will respond with prefacing that you are asking a question that now involves the US Taxing entity. I explained that I audited for the Social Security Administration not the IRS.
From SSA's standpoint it's not your money. That's already been established. It's not your money for two reasons. (A) you didn't work for it, and (B) you are not recieving benefits as a rep payee - you are managing benefits [big difference]. One other thing that I didn't want to say, but I will now. Do you know what happens if the claimant passes away? The Rep Payee [that would be you in this case] does not recieve money any longer. SSA sees this as a person no longer eligilbe or entitled to benefits, but from what I gather, you see it as losing your self-employment earnings.
Quote:
Originally Posted by swanstone1
With my state I have to show any income that I receive and for the past 10 years I have counted the $1000 a month that I paid myself as my income. Was that in error??
I am not certain, but I think it is. I will explain. I've audited many instances where people have claimed self-employment for as menial as deeds as picking up rocks in their front lawn. All of a sudden, they are self employed Aggregate Relocation Specialists that are eligible for the IRS's child tax credit. My point is that I'm not a specialist in income tax law, but just about anything can be self employment. Is it legally wrong? Perhaps not. Can you get away with it? I think you are. Does that make it right? Nope Is it ethical? Nope.
Anyways, I'm done. If you have any questions about SSA go ahead and shoot on another forum.
Why can't you pose it as a RE-DO to benefit YOUR MOM?????? THAT WOULD QUALIFY HER INCOME
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