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Understanding Federal Disability Programs: SSDI and SSI Basics

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Understanding Federal Disability Programs: SSDI and SSI Basics Powered By Docstoc
					   It Helps to Understand the Basics
      of Each Program Before You
          Get Started Applying


UNDERSTANDING FEDERAL
 DISABILITY PROGRAMS –
  SSDI AND SSI BASICS




           RICHARD B. SCHNEIDER
        OREGON ESTATE PLANNING ATTORNEY
         Although most of us prefer not to think about the possibility of becoming
         disabled the reality is that you could become disabled tomorrow. A
         catastrophic car accident, a life-threatening illness, or a tragic work
         accident could result in your long-term disability at any time. In the event
         that you do become disabled how will your family survive financially? Your
         unexpected inability to work may cause serious financial hardship for you
         and your family. The good news is that there are two federal benefit
         programs that may provide you and your family with financial
         assistance. Both the Social Security Disability Insurance, or SSDI,
         program and the Supplemental Security Income, or SSI, program
         provide long-term monetary benefits to eligible individuals.
         Because both of these programs require lengthy, often complicated,
         applications it helps to understand the basics of each program before you
         get started applying.




         Both the SSI and the SSDI program are primarily funded by the Social
         Security Administration, or SSA. Some states provide supplemental funding
         to the SSI program; however, because both programs are funded and
         administered by the Social Security Administration, or SSA, applicants must
         meet the SSA definition of “disabled” to qualify for benefits. According to
         the SSA, you are disabled for purposes of SSI or SSDI benefits if:


               You cannot do work that you did before;



Understanding Federal Disability Programs – SSDI and SSI Basics                         2
               You cannot adjust to other work because of your medical
               condition(s); and
               Your disability has lasted or is expected to last for at least one year
               or to result in death.


         As you can see, the SSA definition of “disabled” requires your disability to
         be both long-term and serious enough to prevent you from working.




         The SSI program is aimed at providing benefits to low-income disabled
         individuals. Federal benefit programs fall into one of two categories –
         means test or entitlement. An entitlement program does not require you to
         meet income and/or resource limit guidelines whereas a means test
         program does. The SSI program is a means test program. As such, you will
         not qualify if you have income that exceeds the income limit. On the other
         hand, the SSI program does not require you to have an earnings record to
         qualify for benefits as the SSDI program does.




         Because the SSI program is a means test program and does not base your
         benefits on your own prior earnings the benefits available from the SSI
         program are typically less than benefits from the SSDI program. Oregon no
         longer supplements the federal SSI benefits, meaning that the maximum
         benefit available to an SSI recipient in Oregon is $710 per month or $1066


Understanding Federal Disability Programs – SSDI and SSI Basics                          3
         for a couple. Up to an additional $356 may be available for an “essential
         person”, defined by the SSA as “someone who was identified as essential to
         your welfare under a State program that preceded the SSI program.”
         The amount of your monthly SSI benefit will be affected by any income you
         receive that month. “Income” includes money from a wide variety of
         sources other than employment. For example, you can qualify for both
         SSDI and SSI but your SSI payment would be reduced by the amount you
         received from SSDI that month. Calculating your income for purposes of
         the SSI program can be complicated because there are a number of
         income sources that are excluded, such as:


            •    the first $20 of most income received in a month;
            •    the first $65 of earnings and one–half of earnings over $65
                 received in a month;
            •    interest or dividends earned on countable resources or resources
                 excluded under other Federal laws;
         Imagine, for example that you received SSDI benefits in the amount of
         $420 this month and earned another $50 in interest from an excluded
         resource. The first $20 of your SSDI benefit would be excluded as would
         the $50 in interest but the $400 left over from your SSDI benefit would
         count. As a result, the maximum SSI benefit you could receive would be
         $310 ($710 - $400).




Understanding Federal Disability Programs – SSDI and SSI Basics                       4
         Eligibility for the SSDI program is determined by your work history, or
         someone else’s work history in certain circumstances. Over the
         course of your lifetime you contribute to the Social Security program.
         To qualify for SSDI benefits you must have worked long enough and
         recently enough. If you qualify, other members of your family may
         also qualify based on your earnings record, such as:


                Your spouse, if he or she is age 62 or older
                Your spouse, at any age if he or she is caring for a child of
                yours who is younger than age 16 or disabled
                Your unmarried child, including an adopted child, or, in some
                cases, a stepchild or grandchild. The child must be younger
                than age 18 or younger than 19 if in elementary or secondary
                school full time
                Your unmarried child, age 18 or older, if he or she has a
                disability that started before age 22. (The child’s disability also
                must meet the definition of disability for adults.)
                A divorced spouse if you were married for at least 10 years,
                he or she is unmarried, and is at least 62 years old




Understanding Federal Disability Programs – SSDI and SSI Basics                       5
         The amount of your monthly benefits from the SSDI program will depend,
         to a large extent, on the number of “work credits” you have earned over
         your lifetime as well as how much you contributed to Social Security. In
         addition, the SSA sets a maximum benefit level each year which, for 2013,
         is $2,533. The amount that an eligible family member receives can be up
         to 50 percent of your benefit amount; however, the family maximum
         benefit amount is somewhere between 150-180 percent of your monthly
         benefit amount.




         As is the case with many federal benefit programs the application process
         can be lengthy and confusing. Moreover, many applicants fail to submit
         enough documentation on which a determination that the applicant is
                                                         disabled can be made.
                                                          According to the SSA’s own
                                                          statistics, only 36 percent
                                                          of all Oregon applicants for
                                                          either the SSDI or the SSI
                                                          program were initially
                                                          approved in 2011. If you
                                                          claim is originally denied
                                                         you must request a
         reconsideration before asking for a hearing. Of all reconsideration requests
         filed in Oregon, only 11 percent were approved in 2011. You may apply for
         SSDI benefits online through the SSA website, via telephone by calling 1-
         800-772-1213, or in person at a local Social Security office. Application for


Understanding Federal Disability Programs – SSDI and SSI Basics                          6
         SSI benefits can be done by completing the disability report online and
         then scheduling an appointment to complete the remaining application
         process at your local SSA office or you may do both at the same time by
         scheduling an appointment at your local SSA office. Because of the high
         rate of denials, you may wish to consult with an estate planning prior to
         applying.


         Social Security, Benefits for People with Disabilities

         Social Security, Supplemental Security Income (SSI) Benefits

         NOLO, Filing for Disability in Oregon




Understanding Federal Disability Programs – SSDI and SSI Basics                      7
         About the Author
         Richard B Schneider
                                      Before devoting his professional efforts primarily to estate
                                      planning, Mr. Schneider spent over fifteen years working
                                      on Wall Street for major law firms and investment banks.
                                      After graduating from law school, he practiced general civil
                                      law in New York City for five years, specializing in business
                                      transactions, financings and corporate matters. He also
                                      represented major investment banking firms in mortgage
                                      trading and real estate-related matters. Among his clients
                                      were international shipping companies, commercial and
                                      investment banks and institutional lenders, including
                                      General Electric Capital Corporation, Salomon Brothers and
                                      Merrill Lynch.

         For the next ten years Mr. Schneider served as Senior Vice President at the investment
         banking firm of Kidder, Peabody, where he managed outside legal counsel for a variety
         of large financial transactions between major institutions. He played a central role in the
         creation of Kidder, Peabody’s mortgage trading subsidiary and advised and executed
         transactions with insurance companies, pension funds and government agencies,
         including the Resolution Trust Company.

         In 1996 Mr. Schneider established a residence in Portland, Oregon and began his law
         practice there in 1997. He has made a long-term commitment to providing first-class
         estate planning legal services to families and individuals within the Portland
         metropolitan area and the surrounding SW Washington region. His motivations for
         moving to the Northwest were several: the natural scenic beauty of the Northwest
         landscape, the clean air and streets, the healthy, diversified economy and the overall
         high quality of life. Mr. Schneider is very grateful for the warm reception he has received
         from Portland/Vancouver and is pleased to have become a respected member of the
         Portland/Vancouver legal and business community.

         Mr. Schneider is a member of the American Academy of Estate Planning Attorneys, the
         National Academy of Elder Law Attorneys, the Estate Planning Council of Portland and is
         on the board of directors of the the Rental Housing Association of Greater Portland. He
         is admitted to practice in Oregon, Washington and New York.

                               Law Offices of Richard B Schneider, LLC
                                            www.rbsllc.com
                                    2455 NW Marshall St, Suite 11
                                          Portland, OR 97210
                                        Phone: (503) 241-1215




Understanding Federal Disability Programs – SSDI and SSI Basics                                        8

				
DOCUMENT INFO
Description: There are two federal benefit programs that may provide you and your family with financial assistance. Both the Social Security Disability Insurance, or SSDI, program and the Supplemental Security Income, or SSI, program provide long-term monetary benefits to eligible individuals. Because both of these programs require lengthy, often complicated, applications it helps to understand the basics of each program before you get started applying.