ssi and winning a lottery or sweepstakes?

What happens if you entered a sweepstakes and you win a certain amount of money. Say 5,000. When you report the money to social security do they stop your ssi payments until you use that money up? And do they count the gross or net value for tax purposes, since you have to also pay income taxes on that money.

Updated : May 16, 2010 by Guest

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SSI and income received from lottery or sweepstakes

May 18, 2010 by David Luhman

You would have to report this income and any remaining money (after income tax withholding) would be treated as a "resource".

For example, say a woman living in California gets a $500 Social Security widow's payment and a $270 SSI payment. In June, she buys a lottery scratch-off card and wins $200 and reports that to the Social Security office. That means in August, her SSI payment will be reduced to $70. In this example, her SSI payment will go back to $270 in September.

Generally, the more income you have, the less your SSI benefit will be. If your countable income is over the allowable limit, you cannot receive SSI benefits. Some of your income may not count as income for the SSI program.

The value of your resources is one of the factors that determine whether you are eligible for SSI benefits. However, not all resources count for SSI. If the value of your countable resources is over the allowable limit at the beginning of the month, you cannot receive SSI for that month.

Income tax refunds are not counted as income.

The limit for countable resources is $2,000 for an individual and $3,000 for a couple.

http://www.ssa.gov/ssi/text-income-ussi.htm

http://www.ssa.gov/ssi/text-resources-ussi.htm

http://www.ssa.gov/pubs/11011.html#part2