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Volume 11 - Opinions of Counsel SBRPS No. 9

Opinions of Counsel index

Persons with disabilities and limited incomes exemption (income requirement) (Social Security Disability Income for children); Senior citizens exemption (income requirement) (Social Security Disability Income for children) - Real Property Tax Law, §§ 459-c, 467:

Social Security Disability Income (SSDI) payments paid to the children of an applicant for the persons with disabilities and limited incomes exemption or the senior citizens exemption are not considered to be the income of the parent.

Our opinion has been requested concerning the persons with disabilities and limited incomes exemption (Real Property Tax Law, § 459-c) and the senior citizens exemption (RPTL, § 467). The question is whether, in computing the income of an applicant for either exemption, Social Security Disability Income moneys received by an applicant’s children should be considered to be the income of the applicant. The argument that it should be so considered is that these moneys were paid on account of the applicant's disability.

Both statutes provide that the income to be measured in determining income eligibility is “the income of the owner or the combined income of the owners of the property” (RPTL, §§ 459-c(5)(a), 467(3)(a)). {1}  Presumably, the children in question do not have a present ownership interest in the property. {2}

To be entitled to child’s insurance benefits as the child of an individual entitled to . . . [social security] disability insurance benefits, . . . a child must:

(1) have filed an application for the benefits;

(2) be dependent on the insured individual;

(3) be unmarried; and

(4) be either under age 18, under age 19 and a full-time elementary or secondary school student...(70A Am Jur2d, Social Security and Medicare, § 723).

We assume that the children’s payments in question are being paid under the program referred to above.

In 6 Op.Counsel SBEA No. 57, we expressed the opinion that “moneys received from the Social Security Administration by a parent as representative payee of a student beneficiary” were not income of the parent for purposes of section 467. {3}  That remains our opinion, and, given the similarity of the income requirement in section 459-c, we reach the same conclusion for purposes of that statute. In our opinion then, assuming the SSDI payments in question are made to the children or to the parent as representative payee of the children, they should not be considered as income of the parent. {4}

May 1, 2001

{1}  Both statutes also provide that, if title is vested in a husband or wife, their combined incomes are to be considered.

{2}  If they did, this would likely disqualify the property from either exemption because each requires that all of the owners be disabled or of sufficient age (with exceptions only for spouses or siblings).

{3}  Since that opinion was issued, the Code of Federal Regulations cited therein has been amended. The relevant provisions are currently found in 20 C.F.R. § 404.2001 et seq..

{4}  As to possible income taxation of such benefits: “If both taxpayer and taxpayer’s child receive benefits, but the check is made out in taxpayer’s name, only the taxpayer’s portion of the benefits is used in figuring if any part is taxable to the taxpayer. The child’s portion of the benefits must be added to the child’s other income to see if any of those benefits are taxable” (33A Am Jur2d, Federal Taxation (2001), 13001).