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Author: Jeanwa Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121219  
Subject: Re: Child's SSDI Payments Date: 9/17/2007 4:40 PM
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A friend of mine was recently approved for Social Security Disabiliby payments - including a lump sum for retroactive payments. Because of her disability, there is also a payment for support of her daughter - again, ongoing payments and a lump sum for retroactive payments.

The parents are very by-the-rule about using the daughter's payments for her support. They are wondering whether it is okay to apply the daughter's payments, particularly the lump sum, towards a home equity loan that they took out to make legally required modifications to the home. (The law is involved because the daughter is adopted; the renovations addressed an environmental cause for a medical condition.)

As my friend explains it: "the renovations were required for her, but I do admit that the rest of the family benefits from them. We would not have done them at this time if we weren't required to do so. And some probably never would have been done."

Thanks,
- Parkway


I called a friend that has a daughter on SSI, which is different than Social Security Disability.

You didn't really give enough info, however........

There is a couple of ways to look at this.

1. Even though everyone benefits the modifications were required by the medical conditions..so the payments can be used for the loan.

2. The lump sum payment was for previous support. Support already paid, therefore it's more like a reimbursement. So, IMHO, paying for the loan is okay.

I hope that helps.

I would look at the Social Security Administration not the IRS for "support" rules. I couldn't find any on a quick search, that's why I called my friend. There is something about when a child turns 16 the check goes to the child not to the parent. The parent can charge a % for household expenses. For example if there are two people living in the house the rent, utilities, etc. are split 50/50 and the child can be responsible for their share. The rest of the money should go to things for the child.

There might be a better board to ask your question on. Maybe this one.

http://boards.fool.com/Messages.asp?bid=100162

Jean
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