Social Security Disability Insurance
New Law Eliminates Social Security Penalty
If you got to this web page, you probably have a concern or a question regarding some aspect of a benefit provided by Social Security. This page is divided into three sections. First is the section that deals with Social Security in general. We update this section to include recent changes in social security law and/or benefits.
The second section deals with SSDI (Social Security Disability Insurance).
The third section deals with SSI (Supplement Security Income).
We invite you to scroll down through each section until you find what best answers your question.
In addition, you are welcome to call Nichols & Eberth toll free at (313) 561-5700 if you would like to have a free no obligation consultation with an experienced social security attorney.
SECTION I:
SOCIAL SECURITY IN GENERAL
New Law Eliminates Social Security Penalty
This year, Congress repealed the penalty on the social security benefits of senior citizens between the ages of 65 and 69. Previously, those 65 through 69 had their social security benefits reduced by $1 for every $3 of income earned above the cap which reached $17,000 this year. Now the earnings test is gone. However, it still applies to those who retire early, ages 62 through 64, who will continue to have their benefits reduced by $1 for every $2 they earn in excess of $10,080 in 2000. In addition, the “normal” retirement age, now 65, begins to rise gradually this year for those born in 1938 and after and will reach 67 for everyone born in 1960 or after.
SECTION II:
SOCIAL SECURITY DISABILITY INSURANCE
What if you are denied SSDI benefits and want to appeal? You may request representation by an attorney. An attorney is paid from the back benefits you receive. There is a maximum amount of money the attorney can receive. In the event the appeal is unsuccessful, the attorney does not receive a fee. Call Nichols & Eberth toll free at 313-561-5700 for a free no obligation consultation.
What Is Social Security Disability Insurance?
Social Security is one of the three basic protections provided by Social Security. The other two are Old Age Insurance and Survivors Insurance (OASI). When a worker’s earnings are stopped or reduced for a year or more because of a severe impairment, the worker and eligible family members can receive monthly cash benefits from SSDI. Benefits continue until the individual dies or is able to work again. The Social Security definition or disability is very strict. Workers are considered disabled if they cannot do any work in the economy because of their medical condition(s). The disability and the inability to work must last or be expected to last for at least a year or result in death.
Who Pays for SSDI?
Each of 144.2 million workers and their employers pays 6.2 percent of the worker’s wages, up to the taxable maximum ($87,000 in 2003) into OASDI. Another 14.6 million self-employed workers pay 12.4 percent (6.2 percent as employer and 6.2 percent as employee). Of the 12.4 percent:
- 1.88 percent is directed to SSDI
- 10.52 percent is directed to OASI
Who Are SSDI Beneficiaries?
Disabled Workers. In 2001, more than 6.7 million people were receiving SSDI benefits. Of those, approximately 5.1 million were disabled workers. There were:
- 2.9 million men
- 2.2 million women
All of disabled workers:
- 75 percent are white
- 18 percent are black
- 7 percent are other
Most SSDI beneficiaries are age 50 and older. Almost two-thirds are aged 50-64; only 2.8 percent are younger than 30. Of all disabled workers, more than 27 percent are diagnosed with mental disorders other then retardation. Just under one-quarter of beneficiaries are diagnosed with musculoskeletal disabilities.
Families of Disabled Workers. More than 1.6 million individuals receive SSDI benefits as dependent family members of disabled workers. Approximately,
- 1.47 million are children
- 165 thousand are wives and husbands.
Included in the 1.47 million children are adult children who became disabled before age 22 and are dependent on the disabled worker. About 57 thousand disabled adult children receive these benefits.
Disabled widow(er) also may receive Social Security benefits based on their spouse’s work record, but these are not SSDI benefits; they are survivor benefits. Widow(er)s who are severely disabled, are age 50 or older, and became disabled no more than 7 years after either the death of their spouse or the last month they were previously entitled to benefits on the worker’s record may be eligible. Widows are the majority in this category. Out of the 200,130 total disabled spouses, more than 195,000 are women.
Do SSDI Beneficiaries Return to Work?
While provisions that encourage beneficiaries to return to work have been enacted over the years, fewer than one in 500 beneficiaries is able to leave the program and return to work.
What Is the Amount of an SSDI Benefit?
An SSDI benefit is calculated using a formula similar to that used for Social Security retirement benefits. The exact amount of an SSDI benefit is based on the disabled worker’s age, level of earnings, and the time in the work force. The average benefit paid to the disabled worker in 2004 was $1,038.00.
What Part Does Social Security Play in the Income Security of Disabled Workers and Their Families?
For families with a disabled worker, Social Security benefits and earnings represent the largest shares of income-38 percent from earnings, and 38 percent from Social Security. In contrast, others aged 18-64 receive 88 percent of their family income from earnings and 2 percent from Social Security.
How Many Families with a Disabled Worker Would Be Poor without SSDI?
The poverty rate for families with a disabled worker is more than double that for families without a disabled worker: 18.5 percent compared with 9 percent. Without Social Security benefits, the poverty rate for families with a disabled worker would increase from 18.5 percent to 55 percent.
In addition, more families of disabled workers have income between poverty and 125 percent of poverty than others who are aged 18-64—14 percent and 4 percent respectively.
What Happens to SSDI Benefits When the Worker Reaches Age 65?
Benefits for disabled workers are converted from disability to retirement benefits at age 65 and are no longer counted in the category of disabled worker benefits.
What If You Are Denied SSDI Benefits?
You may request representation by an attorney. An attorney is paid from the back benefits you receive. There is a maximum amount of money the attorney can receive. In the event the appeal is unsuccessful, the attorney does not collect a fee. We have attorneys at Nichols & Eberth who specialize in SSI appeals. For more information, call Nichols & Eberth at 313-561-5700. There is no charge for the consultation.
SECTION III:
SUPPLEMENTAL SECURITY INCOME (SSI)
What Is SSI
SSI pays monthly cash benefits to individuals who have both limited income and limited resources. The Social Security Administration administers this federal program. If eligible, individuals may receive both SSI and Social Security benefits. And, in most states, a person who receives SSI benefits is automatically eligible for health benefits under Medicaid.
What If Your Claim Is Denied
If you are denied SSI benefits, you can appeal and you can request representation by an attorney. An attorney is paid from the back benefits you receive. There is a maximum amount that the attorney can receive. In the event the appeal is unsuccessful, the attorney does not receive any fee. We have attorneys at Nichols & Eberth who specialize in SSI appeals. For more information, call Nichols & Eberth at 313-561-5700. There is no charge for the consultation.
How To Qualify for SSI
To qualify for SSI, individuals or couples must be age 65 or older, or blind, or disabled. Individuals or couples also must be U.S. citizens. There are certain exceptions for non-citizens.
Applicant’s resources (cash and savings) cannot exceed:
- $2,000 for an individual
- $3,000 for a couple
The bottom line: SSI provides extra money for eligible low-income people. Certain resources, such as a home, a small burial fund, or one car usually do not count.
Monthly unearned income cannot exceed:
- $550 for an individual
- $816 for a couple
These figures will be higher for people who have earned income (earnings from a job, for example).
The amount of the SSI benefit will depend on the income the individual or couple receives. The maximum federal SSI benefit is:
- $530 for an individual
- $796 for a couple
For More Information
A variety of information is provided by the Social Security Administration:
- www.SocialSecurity.gov
- Supplemental Security Income
General information and eligibility requirements for individuals - Supplemental Security Income (SSI) For Noncitizens
Eligibility requirements for non-citizens - SSI State Supplements
A list of states that provide extra income above the federal guidelines
You can find out if you’re eligible for SSI by visiting your local Social Security office or calling the Social Security Administration at 1-800-772-1213 (English or Spanish). You can apply over the telephone, and it’s best to apply as soon as possible. If your application is approved, your benefits will start the month following the date of the application.
