Other Income May Shrink Social Security Disability Benefits

The Social Security Administration says that calculating what you deserve in benefits is easy. Let’s hope you’re good at math, because these are some of the simpler rules you will deal with:

  • Social Security disability (SSD) benefits may be reduced when disability payments from other sources push the total monthly payment to more than 80 percent of a person’s average monthly earnings before he became disabled.
  • Generally, compensation benefits received through other government sources because of work-related illness or injury may impact Social Security disability totals. Payments received from employers—or from insurance companies on behalf of employers—can lower Social Security benefits.
  • Social Security disability benefits are not affected for persons receiving local and state benefits if Social Security taxes were deducted from earnings. In addition, Veterans Administration benefits do not interfere with SSD benefit levels.
  • Although disability payments from private insurance policies or pensions are not supposed to affect Social Security benefits, payments from local, state, or federal agencies for disabling conditions that aren’t job-related can. Examples of the latter are state temporary disability benefits, civil service disability, and local or state government retirement benefits based on disability.
  • The amount of a person’s Social Security disability payment is based on how much the person and other family members receive in disability payments from other public sources such as workers’ compensation. Social Security says the total cannon exceed 80 percent of what the claimant was earning before becoming disabled.
  • Social Security offers an example of a person earning $4,000 a month before being disabled, qualifying for a $2,200 SSD payment. If the person also received $2,000 in workers’ compensation or other public funds, the total would be $4,200, well above the 80 percent ceiling ($3,200). Social Security would then reduce its payment by $1,000, bringing the total payment of public funds to $3,200, or 80 percent of $4,000.
  • The lower SSD payment remains until the person turns 65 or the workers’ comp or other public benefits cease.
  • Social Security says it uses varying formulas to determine a person’s average earnings. It also advises it must be notified if a person has received a lump-sum disability payment from a public source, because that can also impact an SSD claim.

It’s easy to see why knowing what to expect from Social Security when filing disability or Supplemental Security Income (SSI) claims can be confusing—even frightening. The experienced Daytona Beach Social Security disability claims attorneys at Johnson & Gilbert have been applying successfully for clients for more than 15 years. If you are filing a claim or know someone who is, call Johnson & Gilbert at 386.673.4412 or toll free at 800.556.8890. You can set up a free consultation at our Ormond Beach offices serving north and central Florida to evaluate your Social Security disability or supplemental income claim.