You’re in a tough spot. Medical bills are piling up, or maybe you need a new wheelchair van, and a friend says, “Hey, let’s start a GoFundMe for you.” And it sounds like a lifeline.
But for millions of Americans, that act of kindness can actually turn into a financial nightmare.
If you’re on Social Security, accepting that cash could accidentally pause, reduce, or even cancel your monthly benefits. But—and this is a huge but—it depends entirely on what kind of Social Security you have.
So today, I’m going to break down the two systems you need to know, the $2,000 trap that catches a lot of people off guard, and three specific ways you can accept GoFundMe donations without losing your check.
This is a transcript of our video. You can watch the full video on our YouTube channel: Low Income Relief.
Two Very Different Rule Books
Now let’s clear up the confusion. There are two very different rule books here, and you need to know which one you’re playing by.
The first rule book is for the insurance group. This includes people on Social Security retirement, survivors benefits, SSDI, Disabled Adult Child benefits, and more. If you’re in this group, you’re probably in the clear with GoFundMe because these Social Security benefits are based on work history, not financial need.
However, you should not click away yet. Because while the Social Security Administration likely won’t cut your monthly Social Security check because of a GoFundMe, you’re still not immune to consequences.
Many of you also rely on SNAP, Section 8 housing, or Medicaid, and those programs are means-tested. So a GoFundMe could leave your SSDI check untouched, but instantly disqualify you from your apartment or your food assistance. And if that money isn’t handled correctly, you could also get a tax form that treats those donations as taxable income.
So even if you’re on SSDI or retirement, I’d encourage you to stay tuned to the end, because we’re going to talk about three ways you can protect those benefits too.
Why SSDI Is Usually Not Affected
The last time we talked about GoFundMe, it was in a Q&A at the end of one of our videos. I said that SSDI was not likely to be affected by GoFundMe, but someone in the comments was really concerned and pushed back. They pointed out that SSDI does have income limits and were pretty sure I was wrong.
So we did some extra research, because I always want to make sure we’re giving you the most accurate information possible.
The good news is that generally speaking, Social Security Disability Insurance does not care if you have a million dollars in the bank or if you get $10,000 from a GoFundMe. As long as that money is a gift and not wages you earned at a job, it doesn’t really matter for this program.
The income limits for SSDI are strictly about work. They’re based on the idea that you shouldn’t be getting disability benefits if you’re able to work. So those income limits apply to earned income, not unearned income like gifts or donations.
Why SSI Is Very Different
Now, that’s only for SSDI. If you’re on SSI, this is a whole different ballgame, and you need to listen very carefully.
SSI is a needs-based program. It’s strictly for people who don’t have enough income or assets. Because of that, the government watches every penny that comes into your life.
This is where GoFundMe can become very dangerous. For SSI recipients, GoFundMe donations can hit you in two waves.
Wave One: Income
In the month you receive the money, the Social Security Administration counts it as unearned income. Since SSI exists because you don’t have enough money, if you suddenly receive $1,000 from a fundraiser, your SSI is reduced dollar for dollar in that month.
They don’t count the first $20 because of the general income exclusion, but everything else counts. If you raise more than your monthly benefit amount, you usually won’t get a check at all that month.
Wave Two: The $2,000 Resource Limit
The second wave is the long-term danger. Whatever money you don’t spend by the end of the month becomes a resource on the first day of the next month.
To stay on SSI, an individual generally can’t have more than $2,000 in countable resources. A married couple is limited to $3,000.
So let’s say your GoFundMe raises $5,000 for an emergency car repair. The money goes into your bank account. You lose your check for that month. Then, if you don’t get that repair done within that same month, you may now be over the resource limit. Your SSI—and usually your Medicaid—could be suspended entirely until you spend down below that limit.
You essentially have to spend the donation to get your benefits back, which leaves you right where you started.
What if Someone Else Runs It?
I know what you’re thinking. “I’ll just have my friend run the campaign, keep the money in their account, and buy things for me.”
That can still backfire. According to Culhane Law, having a friend or family member run the GoFundMe for you is a risky idea. Social Security doesn’t have clear rules for when someone else collects crowdfunding money and then pays for things on your behalf.
Other sources warn about in-kind support and maintenance. If your friend uses that money to pay for your shelter or utilities, Social Security can still reduce your SSI check by up to one-third.
If they use the money for other expenses, it usually doesn’t count against you. But the Special Needs Alliance points out that because the Social Security Administration hasn’t published clear rules about crowdfunding, there are still gray areas. Even if someone else manages the account, means-tested benefits could still be affected.
So yes, this can still be risky.
Three Safer Ways to Accept Help
The rules can feel incredibly frustrating, especially when you’re just trying to get help. But there are safer options.
Option One: An ABLE Account
If your disability began before age 46 and meets certain criteria, you may be eligible for an ABLE account. This works like a shield for your money.
You, your friends, and your family can put up to $20,000 a year into an ABLE account, and Social Security ignores it. It doesn’t count as a resource unless the account balance goes over $100,000.
You can use ABLE funds for qualified disability expenses, including housing, transportation, and healthcare. If your GoFundMe money can go directly into your ABLE account, this is one of the best options.
Option Two: A Special Needs Trust
If you don’t qualify for an ABLE account or you raised a large amount of money, a special needs trust may be an option. There are first-party and third-party trusts, and the sources I reviewed generally recommend third-party trusts for crowdfunding when possible.
Trusts can get complicated fast, especially because of Medicaid payback rules. I strongly recommend talking to a trust or elder law attorney before making decisions.
We’re also looking into bringing ABLE and special needs trust experts onto the channel for live Q&As, because I know a lot of you have questions about this.
Option Three: Use a Different Platform
Instead of GoFundMe, you might consider a nonprofit platform like Help Hope Live. With this platform, donors give to the nonprofit on your behalf. The nonprofit holds the money and pays your bills directly.
Because the money never belongs to you, it generally doesn’t count against SSI or Medicaid. That said, always double-check your state rules before moving forward.
What If the Money Is Already in Your Account?
If the money is already in your account and you don’t have a trust or an ABLE account, you may need to do a spend-down. That means spending the money in the same month on exempt assets, like paying off debt, repairing a car, buying household items, or prepaying funeral expenses.
Turning cash into exempt items before the end of the month can help you avoid the long-term resource penalty.
Do Not Hide the Money
Please do not try to hide GoFundMe money from Social Security. Crowdfunding platforms may issue a 1099-K in certain situations, and the Social Security Administration can find unreported income through data matching.
If you’re on SSI and fail to report income, you could face overpayment notices years later demanding tens of thousands of dollars back. Always report income changes no later than 10 days after the end of the month in which the change occurred.
Final Notes
If you’re on SSI, you have to be very strategic. Don’t let a blessing turn into a burden.
If you’re on SSDI, retirement, or other non–means-tested Social Security programs, your Social Security itself is usually okay—but you still need to protect your other benefits.
ABLE accounts are especially powerful, and millions more people are eligible now. You can learn more here.