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Understanding Social Security Disability Benefits

Social Security is one of several potential sources of financial support for people who cannot work due to an injury or illness. As with any form of financial support from the government, Social Security disability benefits are subject to a range of restrictions and prerequisites. The benefits may also affect one’s ability to get financial support through other sources, so anyone considering applying for Social Security benefits should examine not just the rules for the program itself but also how it may play into a larger strategy of making ends meet while off work.

Qualifying for Social Security disability benefits requires a number of specific elements. The first is that the applicant must have paid into the Social Security system by working in jobs that contribute to it. People who work in jobs that are exempt from Social Security will not qualify. Second, the applicant must be disabled in accordance with the Social Security Administration’s (SSA) definition of the term. For Social Security purposes disability means:

  • The applicant is unable to do the work he or she did before the injury or illness due to limitations in the applicant’s physical or mental abilities.
  • The applicant’s condition makes switching to different work untenable.
  • The condition has lasted or is expected to last for at least one year, or is expected to result in the applicant’s death.

In addition to these prerequisites, a condition also must appear on the SSA’s list of impairments. Although this list is quite extensive, it may not capture every potential condition that could disrupt someone’s ability to work. This is especially important to keep in mind if a physician providing a diagnosis is doing so with a mixed set of incentives, as can be the case for physicians who conduct screening for insurers.

Social Security disability and other sources of support

For people who have been disabled as a consequence of an injury, questions often arise as to how Social Security disability benefits may affect, and be affected by, workers’ compensation claims, personal injury settlements, and state disability benefits. There isn’t one answer to this question, which depends on the source of the alternative support and a range of other factors. For example, Social Security disability payments probably will not be affected by a personal injury settlement or favorable judgment. But they may be reduced if disability payments from a state program combine with the Social Security benefits to exceed eighty percent of the applicant’s former annual income. Note that other forms of Social Security payments, like supplemental income (SSI), are subject to different rules.

For more than 45 years the law firm of Greenman Goldberg Raby Martinez has helped injured clients find strategies for making ends meet after being injured. We provide personalized advice to each client to ensure that their full circumstances are taken into account as we explore legal solutions together. Call us today for a free attorney consultation at 702-388-4476 or reach us through our contact page.

Supplemental Security Income Benefits and Personal Injury Settlements

The goal of most personal injury lawsuits is to make the injured plaintiff financially whole by requiring the person responsible for the injury to assume its associated costs. For a variety of reasons most personal injury disputes end up settling out of court. In filing suit the plaintiff makes claims for damages suffered in connection with the defendant’s negligence or other wrongdoing. Damages typically include medical bills and property losses. They also usually include lost earnings.

Plaintiffs who receive Supplemental Security Income, or SSI, can be surprised to learn that their personal injury settlement can affect their eligibility for continued payments under the SSI program. SSI is a program operated by the federal Social Security Administration that provides supplemental income to qualified individuals. To qualify an individual must, among other things, be disabled, blind, or over the age of 65. The individual must also “have limited income and resources.”

A straightforward cash payment as part of a personal injury settlement usually will push an individual out of qualifying under this second, asset-based requirement. An individual with qualified assets worth more than $2,000, or $3,000 for a married couple, is not eligible for SSI benefits. A significant number of personal assets are not included in this figure: the SSA does not count the value of a primary home, a vehicle, household goods, and business property. However, ordinary cash held in a checking or savings account does count toward the resources limit. As such, accepting a check in a settlement can instantly disqualify a plaintiff from continuing to receive SSI benefits.

The problem with this outcome is that the funds a plaintiff receives from a settlement generally need to be used straight away to pay off the costs associated with the plaintiff’s injuries. The settlement award is, therefore, not always a windfall but simply a way to pay down debts. If the award also renders the plaintiff ineligible for SSI benefits the effect can be the loss of significant and even vital monthly income.

One strategy for overcoming this problem is to create what is called a special needs trust to hold the settlement proceeds. Trusts are legal entities that are created by carefully preparing paperwork. The object of a special needs trust is to place strict limits on how the money in the trust can be used—in the case of an injury settlement, the usual purpose is to pay for expenses related to the plaintiff’s injury. By formally restricting how the plaintiff can use settlement funds a properly designed special needs trust can ensure that the settlement does not qualify as a “resource” that would disqualify the plaintiff for SSI benefits.

Problems like those faced by injured plaintiffs who receive SSI benefits are another good reason to work with an experienced personal injury law firm when pursuing a case. For more than 45 years the law firm of Greenman Goldberg Raby Martinez has represented Las Vegas clients in personal injury cases. If you receive SSI benefits and you have concerns about how your personal injury lawsuit may affect your eligibility, we are happy to discuss your case with you. For a free attorney consultation call 702-388-4476 or send us a request through our site.