Disability impacts all of us. More than one in four adults in the United States have some type of disability.1 With so many affected by disability, you are bound to receive questions from your clients such as whether they should apply for benefits, when they should apply, or whether income affects benefits. Knowing these common myths about social security disability will help you avoid perpetuating misconceptions when advising your clients.
- You do not have to pay taxes on social security. A portion of social security benefits are taxable depending on the amount of the benefits.
- Social security cannot be garnished for alimony, child support, or restitution. Social Security can withhold benefits to enforce a legal obligation to pay child support, alimony, or restitution.2 SSI payments, however, cannot be levied or garnished.3
- Your assets prevent you (or your child) from being eligible for benefits. There are two types of social security disability programs and only one has income and resource requirements.
- Social Security Disability Insurance (SSDI) is for those who pay into social security through payroll taxes. They can receive benefits if disabled regardless of current assets or unearned income. Disabled adult children and surviving spouses may also obtain benefits if the parent or spouse paid into social security.
- Supplemental Security Income (SSI) is needs based and does not require paying into social security through payroll taxes. That program does have income and resource requirements. To qualify for SSI, individuals cannot have more than $2,000 in assets (with some exclusions including the primary residence). Both types of disability have the same medical standard of disability.
- If you are partially disabled, you can receive a partial benefit. While some other types of disability benefits such as veterans benefits allow for a disability rating or partial disability, Social Security only allows benefits for total disability.
- If your doctor agrees you are disabled and takes you off work, you are entitled to disability. Social Security has its own five-step process to determine if an individual is disabled. A treatment provider’s conclusion that an individual is disabled is generally given little weight. However, an opinion from a doctor about an individual’s functional restrictions due to his or her medical impairments is much more useful.
- If you are awarded disability, you will be able to stay on benefits for life. Social Security conducts medical reviews approximately every three years for disability beneficiaries, though the review time varies. If medical records indicate improvement, beneficiaries’ benefits may stop. There are also several work incentives for those who improve and want to attempt a return to work.
- You are disabled if your medical conditions prevent you from returning to your job. To be found disabled, individuals have to show they cannot return to their last job. However, in addition, they must show they cannot return to any other type of work they have done in the last 15 years as well as a significant number of other jobs in the national economy. Prior earnings are not considered. Depending on the person’s age, someone with a previous $100,000 salary position would not be disabled if she could return to a minimum wage fast food job.
- You cannot receive worker’s compensation or other government benefit and social security at the same time. While an offset may be applied, individuals can receive worker’s compensation, state disability benefits, veterans benefits, and private disability insurance while also receiving social security disability. However, the benefits from those programs will count as income that may disqualify an individual from receiving SSI.
- You should be granted when you are clearly medically disabled. There are several reasons individuals who meets the medical requirements for disability can still be found ineligible for benefits including:
- They have not worked 5 of the last 10 years. If individuals become disabled more than five years after they stop working, they will not be entitled to benefits (with some exceptions) unless they meet the income and resource guidelines for SSI.
- They are still working and earning money. Individuals who manage to work and earn more than $1,350 per month even working part-time will not be found disabled in most circumstances.
- Their impairments have not lasted or are not expected to last 12 months or result in death. SSDI and SSI are for chronic, long-term disability.
- Drugs or alcohol use is causing or materially contributing to their disabilities.
- They are not following treatment prescribed by their doctor and if they were, it likely would resolve their symptoms.
- It always takes years to obtain disability benefits. The time it takes to process disability claims varies considerably. About one-third of claimants are granted benefits based on the initial application which usually takes three to six months to process. For those who appeal the initial denial and request a hearing, typically it takes one to two years to obtain a decision at the hearing and start receiving benefits. About 45 percent of claimants are granted at the hearing level but with wide variation based on the judge. Depending on how many times the claimant appeals, sometimes it can take many years to obtain disability benefits.
- Disability rolls are increasing. While applications for retirement benefits increased, especially during the pandemic, disability applications have been decreasing for several years as baby boomers have retired. In fact, fewer people are receiving disability benefits now than in the last 10 years.4
Navigating social security or advising your clients about it can seem daunting due to its complexity. But knowing some basics can ensure you don’t misguide your clients. For more information about social security disability here is a good place to start: https://www.ssa.gov/benefits/disability/
1 “Disability Impacts All of Us,” Disability and Health Promotion, CDC, https://www.cdc.gov/ncbddd/disabilityandhealth/infographic-disability-im- pacts-all.html
2 “Can my Social Security benefits be garnished for alimony, child support or restitution?” FAQ, Social Security Administration, https://faq.ssa.gov/ en-us/Topic/article/KA-01873
3 “129, Benefits Not Transferable”, Social Security Handbook, Social Security Administration, https://www.ssa.gov/OP_Home/handbook/handbook.01/ handbook-0129.html
4 “Selected Data From Social Security’s Disability Program” Office of the Chief Actuary Statistical Tables, Social Security Administration, https://www.ssa.gov/oact/STATS/dibStat.html#f2