SSI, shared expenses, fraudulent conversion and the fungibility of money

[Guest guest]

Not long ago, Theresa described how she kept SSI money separate for her daughter

- see below. I didn't see any response posts, but this seems to need some

clarification. Since money is fungible, what's the difference if the shared

expense money is placed in an account that is inherited, or the parents, having

taken that money as intended then place an annual gift into a Sp. Needs Trust --

or for that matter, spend or give any other money for the benefit of the

daughter. This analysis suggests that if we get SSI, we can no longer add to

the trust, but then the spending on separate living arrangements looks no

different to me.

Original post: " When my daughter was living at home, I 'charged' her

fair share of household expenses which was 1/3rd of the basic costs in

maintaining our home. I took that money and placed it in a savings account in my

and my husband's name

and social security, payable on death to Jen's special needs trust. I did not

place the money directly into her special needs trust as that could be

considered a 'fraudulent conversion' and I didn't want to have to get into

defending the transfer or risk sabotaging an otherwise properly written special

needs trust....

When moved out of our home many years later, I had saved enough money

to completely furnish her new home. was not able to save the money but

by charging' her for the food and shelter she received in my home, I was able to

set aside this money for Jen's future. I also used a portion of the money Jen

paid me for 'rent' to pay the premium on a 2nd to die life insurance policy.

The 2nd to die policy is an excellent method of funding a special needs trust.

Now that Jen is living separately, I have to pay the premium on the policy with

my own funds but for many years, I was able to use Jen's rent money for this

purpose. "