November 2026:

The MLO Minute: “In-Kind Support and Maintenance (ISM) Explained” 

By Lesley Mehalick, J.D., LL.M., Supervising Partner of Estates and Trusts — 

Supplemental Security Income (SSI) is a needs-based federal program administered by the Social Security Administration (SSA) that provides monthly cash assistance to individuals who are aged 65 or older, blind, or disabled and who have limited income and resources.   The calculation of SSI benefits is complex, and one of the most challenging aspects involves the concept of In-Kind Support and Maintenance (ISM).

 

In-Kind Support and Maintenance (ISM) refers to shelter that someone else provides to an SSI recipient for free or for less than fair market value.  The Social Security rationale is that SSI should be sufficient to provide for basic shelter needs, so if another source/person assists with shelter costs, that assistance is treated as a type of unearned income for SSI purposes.

 

ISM is provided in the form of goods or services rather than cash given to the SSI recipient.  Examples would be letting an adult child with special needs live in your home rent free (providing free housing), paying a child’s rent directly, or directly paying their essential utility bills.   Social Security deems the payment of shelter expenses as income, even if no direct cash is provided to the SSI recipient.

 

When the SSI program was established in the 1970’s, ISM encompassed a broader range of items; specifically, the SSA counted assistance with food, shelter, AND clothing as ISM. This meant that if someone gave an SSI recipient clothing or free meals, it could potentially reduce their benefits.  As of March 9, 2005, clothing was removed from the definition of ISM, and in September of 2024, food was also eliminated from the ISM calculation.  Now, family members can help with groceries, share meals, or provide food without worrying about reducing the recipient’s SSI check.

 

Today, only shelter costs are considered as ISM.   Shelter includes rent or mortgage payments, property insurance required by a lender, property taxes, and essential utilities, which are generally, electricity, gas, water, sewer, and garbage collection.  Non-essential utilities, such as cable, internet, and phone, are generally not included in ISM.

 

When an SSI recipient receives ISM, the SSA may reduce that person’s monthly SSI check.  However, there’s a limit to how much the person’s SSI will be reduced.  This is called the Presumed Maximum Value (PMV) rule. The PMV rule establishes that no matter how much shelter assistance someone receives, the reduction in SSI benefits cannot exceed one-third of the maximum allowable SSI payment for that year (called the Federal Benefit Rate (FBR)), plus a $20.00 disregard.   For example, in 2025, the FBR for SSI is $967.00 per month.  If we divide that by 3 and add $20.00, we get the PMV for 2025 of $342.33.  This means that regardless of the amount of shelter costs paid on behalf of the SSI recipient (for example $1,500.00/month), his SSI payment will only be reduced by $342.33/month.

 

Because of the PMV limitation on the reduction of SSI benefits, it may make sense for shelter expenses to be paid for an SSI recipient and to have this reduction in benefit.   The individual will still receive his SSI payment, maintain Medicaid eligibility, and have a safe and appropriate living situation.

 

It is noteworthy that payments for shelter made from an ABLE account do not cause this same reduction to SSI.   An ABLE (Achieving a Better Life Experience) account is a tax-advantaged savings account available to individuals with disabilities that began before age 26 (expanded to age 46 as of January 1, 2026).  Contributions to an ABLE account are limited to the annual gift tax exclusion amount for that year ($19,000 in 2025 and 2026), but there is an exception where if the beneficiary is working, he can additionally contribute his earned income up to a certain amount to the account.   Money distributed from an ABLE account to pay for housing expenses does NOT count as income or as ISM and therefore does NOT trigger ISM reductions.  Thus, a way to potentially avoid the PMV reduction to SSI would be to fund an ABLE account and use those monies for shelter expenses.

 

Understanding In-Kind Support and Maintenance and the Presumed Maximum Value rule is essential for SSI recipients and their families.  This article provides an overview of these concepts, but the rules governing SSI and ISM are quite complex and the ISM regulations contain numerous exceptions, special circumstances, and nuanced provisions that may apply to specific situations.  The elimination of food from ISM in September 2024 may signal continued reform efforts, but until further changes are implemented, recipients must navigate the existing framework with care, knowledge, and when necessary, professional assistance.