What Types of Income Impact My Disability Claim?

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Some types of income and benefits may affect Social Security Disability Insurance and Supplemental Security Income claims. People who cannot work as a result of a long-term or permanent disabling medical condition may qualify for benefits through the Social Security Administration’s disability programs. However, their financial circumstances and some benefits they already receive may impede their ability to receive SSDI or SSI payments.

How Public and Government Benefits Impact SSDI

People who receive some types of public or government benefits may have their SSDI benefits reduced or they may be ineligible for disability benefits entirely. The types of benefits that may affect SSDI awards include:

  • State and local government retirement benefits
  • State temporary disability benefits
  • Civil service disability benefits
  • Workers’ compensation payments

Receiving these types of benefits or payments does not automatically disqualify people for disability benefits. Rather, Social Security disability benefits payments will be reduced if the claimant’s combined benefits exceed 80% of their average current earnings. For example, an injured worker is receiving workers’ compensation payments and state temporary disability benefits. Totaled, the amount of these awards is 90% of the worker’s pre-disability earnings. Left permanently unable to work, the worker also receives SSDI benefits. The SSA would deduct the extra 10% from their disability awards.

Income Limits for SSI Claims

A need-based program, SSI provides monthly payments for disabled workers with low income and few resources. The financial circumstances of applicants, including any sources of income and assets, play a key role in determining eligibility for SSI benefits. The income limits to qualify for SSI vary from state to state. In determining eligibility, Social Security may consider any income from working, retirement funds or distributions, interest and other income from investments and other income sources. Additionally, the SSA may review assets that could be converted to money and used to help support applicants, including cars and other vehicles, houses and other real estate holdings and long-term investments. However, Social Security excludes a portion of people’s income and assets when determining if they fall under the benefit income limit.

The SSA also considers other factors that affect applicants’ financial circumstances, such as their living situations, whether they are married and if their spouse also receives SSI benefits. For example, the living arrangement of an applicant who resides rent-free with a relative or friend may be considered a financial resource.

Benefits that Do not Affect SSDI Claims

Some types of benefits and income received by applicants do not affect their disability claims. For example, the SSA may not reduce SSDI benefits based on the receipt of private pensions, private insurance benefits, state or local government disability retirement benefits, unemployment benefits and Veterans Administration benefits. Also, payments received from negligence or tort case settlements, Railroad Unemployment Insurance Act claims, Federal Employer’s Liability Act claims and Jones Act claims typically do not factor into SSDI awards.

Types of Income that Is not Countable for SSI Purposes

The value of food stamps (SNAP benefits), home energy assistance, income tax returns, grants and scholarships used for tuition, earnings up to $1,870 per month for students under 22 and small amounts of income that is received irregularly are typically not countable for SSI purposes.

Working While Receiving Disability Payments

Since SSDI and SSI determinations are based on the claimant’s inability to work, receiving wages for work performed may result in a reduction or termination of benefits. However, Social Security offers paths for benefit recipients to test their ability to return to work without losing their benefits. The SSA’s work incentives program allows people to continue to receive cash benefits as well as Medicare or Medicaid for a nine-month period while they work. The SSA’s Ticket to Work program offers claimants free vocational rehabilitation and training, job referrals and other employment support. During the nine-month trial work period, Social Security does not cap the amount people can earn and still receive their SSDI benefits. However, during the 36-month period of extended eligibility, people cannot earn more than $1,220 per month and continue to receive SSDI benefits in 2019. In counting people’s earnings, the SSA deducts the claimant’s disability-related work expenses, such as transportation to or from work in some cases, counseling services, prescription copayments, a wheelchair or any other specialized work equipment.

People may continue to receive SSI benefits while working, provided their combined earnings and other income does not exceed the state’s SSI income limit. Should they have to stop working again because of their conditions, however, the SSA allows for expedited reinstatement of their benefits. If they make the request within five years of when their benefits stopped, people may ask to have their benefits restarted without having to file a new application.

Social Security Disability

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