Should I Apply For Social Security Disability Insurance Benefits
If you cant work due to a medical condition, you may be eligible for disability benefits through the Social Security Administration. Before beginning the application process, here are some things to know first.
What is Social Security Disability Insurance?
Social Security disability insurance, or SSDI, is a financial safety net for workers who are unable to continue working due to a severe medical condition. It is a total disability insurance program for insured workers.
Are You Insured for Disability Benefits?
If you contributed to Social Security through the jobs youve had by paying an employment tax called the Federal Insurance Contributions Act , you are insured for benefits. But, theres a catch.
Depending on your age, you also must have worked recently enough and accumulated enough quarters. For example, if youre 31 years old or older, the rule is that you must have worked a total of 20 quarters, or five years, within the last 10 years to qualify for disability benefits.
Check Your Earnings Statement
The best way for you to know if youre insured for disability benefits is to check your earnings statement. This statement used to be mailed to you annually about three months before your birthday. Now its available online at the Social Security Administration web site.
Does Your Medical Condition Qualify?
Merienda you know if youre insured for benefits, the next hurdle is to prove that youre disabled.
Apply For Cpp Disability Benefits
To apply online, you must:
- be over the age of 18 and younger than 66 years
- have made CPP contributions
- have a Canadian address
Note: The Online CPP disability benefits application lets you save the progress made on your application after each completed section. You can come back to it within 90 days. This allows you to finish your application in multiple sessions.
You will not be able to apply online if:
- you live in Quebec and have contributed to both the CPP and QPP
- you are already in pay for CPP disability benefits
- you do not have a Canadian address
- your disability benefit was terminated because you returned back to work less than 2 years ago
- you have a payee on file
- you are under the control of a trustee
If any of the above applies to you, you will need to:
After you apply, you may sign in to your MSCA at any time to submit documents in support of your application for CPP disability benefits.
No More File And Suspend
Note that the claiming strategy called file and suspend, which allowed married couples who have reached their FRA to receive spousal benefits and delayed retirement credits at the same time, ended as of May 1, 2016. However, spouses born before Jan. 2, 1954, who have attained their FRA may still be able to file a restricted application. It allows them to claim spousal benefits while delaying their own benefits up to age 70.
Social Security benefits can be taxable if your combined income is high enough.
Spouses Who Dont Qualify For Their Own Social Security
Spouses who didnt work at a paid job or didnt earn enough credits to qualify for Social Security on their own are eligible to receive benefits starting at age 62 based on their spouses record. As with claiming benefits on your own record, your spousal benefit will be reduced if you take it before reaching your FRA. The highest spousal benefit that you can receive is half of the benefit that your spouse is entitled to at their FRA.
While spouses get a lower benefit if they claim before reaching their own FRA, they will not get a larger spousal benefit by waiting to claim after their FRAsay, at age 70. However, a nonworking or lower-earning spouse may get a larger spousal benefit if the working spouse has some late-career, high-earning years that boost their benefits.
Preparing For An Online Application
Before you can apply for any of the Social Security programs online, you’ll need to visit the My Social Security website to create an account and finish the setup process. Not only will this website allow for the initial application, but it also lets you watch the application status, see personalized benefit estimates and make changes like setting up direct deposit for benefits or putting in a new address if you move.
When you click the button to sign up, you’re prompted to either log in with an identity services provider partner account you already have or set up a Login.gov account. In either case, you can expect to provide identifying information, answer security questions and set up a way to get an access code that you’ll use alongside your username and password.
You’ll also receive a code after creating the account. Entering this code on the My Social Security website is needed to activate your account so you can apply online.
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Who’s The Higher Earner
Compare the estimates for you and your spouse, and pay special attention to the difference between your estimates. The higher earner is the spouse with the larger primary insurance amounts .
When you’re deciding who will collect first and who should wait, consider having the lower earner collect first and having the higher earner wait. Over time, the higher earner’s increases will be worth more than the lower earner’s increases.
And if one spouse’s estimates are more than twice as high as the other’s, it might make sense for both of you eventually to collect on the same spouse’s earnings record.
In that situation, the spouse with the lower benefits can claim first based on his or her own earnings record and apply for spousal benefits later when the spouse with the higher benefits starts to collect.
The longer the spouse with the higher benefit waits to start collecting, the higher benefits will be for both spouses. Delaying the higher earning spouse’s benefits could also eventually increase the other spouse’s survivors benefits.
When To Apply For Social Security
As stated above, you are eligible to apply for Social Security retirement benefits when you are 61 and nine months. You can start collecting benefits as soon as you turn 62.
However, just because you can, does not mean that you should.
The longer you delay starting your benefits, the more your monthly income will be. In fact, the difference in lifetime income between starting at age 62 and waiting until your maximum retirement age can be more than $100,000 and for many people much much more.
While you can start benefits at age 62, the Social Security Administration considers that early. Depending on your birth year, you do not reach what the SSA calls full retirement age until sometime between ages 66 and 67.
- For every month prior to your full retirement age that you begin taking benefits, around 0.55% is deducted from your payout.
- And, for every year that you defer your benefits, you will receive a larger amount when you finally do begin drawing Social Security. The amount of the bonus is dependent, once more, on your birth date. For example, someone born in 1944 has a full retirement age of 66. If they start benefits at age 69, they will receive eight percent more benefits for each year they delay.
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Applying For Disability In Person
If you arent familiar with filling out forms online, or if youd like to be able to ask someone questions as you fill out the forms online, you may want to go into the Social Security office. If you decide to go into your local Social Security office, the field representative will lead you through the following paper forms:
- Form SSA-16-BK, Application for Disability Insurance Benefits
- Form SSA-3368-BK, Adult Disability Report,
- Form SSA-3369-BK, Work History Report, and
- Form SSA-827-BK, Authorization to Disclose Information to the Social Security Administration.
What Is Full Retirement Age
In addition to how much youve earned over the years, the size of your monthly Social Security benefit depends on when you were born and the age when you start claimingdown to the month.
Youll receive your full monthly benefit if you start claiming when you reach what Social Security considers your full retirement age , sometimes also referred to as normal retirement age. FRA was 65 when Social Security began, but it has been raised to 67 for anyone born in 1960 or later. To find your FRA, see the chart below.
|Finding Your Full Retirement Age|
The Problem: The Economic Toll From The Pandemic Will Very Likely Affect Social Security Benefits
The initial retirement benefits that Social Security beneficiaries receive in the first year of retirement are determined by a formula that depends, in part, on the growth of average wages in the economy. Due to the economic fallout from the COVID-19 pandemic, the key measure of average wagesthe average wage index is very likely to decline in 2020. As a result, the initial retirement benefits for those who are first eligible to receive benefits in 2022when they reach the age of 62would be significantly less than what was anticipated only months ago, before the pandemic began to exact its economic toll. The effect is very likely to be so significant that workers turning 62 in 2022 would receive initial retirement benefits that are less than those of workers who were born a year earlier and who had essentially the same earnings history. This incongruity is what Social Security experts call a benefit notch. Such a notch would be unfair to the beneficiaries who turn 60 in 2020 and first become eligible to retire in 2022 because benefits are normally expected to grow for each successive cohort of retirees. Moreover, the benefit reduction and notch would have long-lasting consequences, as they not only would affect benefits in the first year of ones retirement but also lower them for every year going forward, as annual benefits are determined by adjusting the initial level for inflation.
Work Information Youll Need
What you do for a living may have an impact on your benefits, so youll need to supply the SSA with some employment information as well. This includes the name and address of your employer for both this year and last year.
Youll also need to know how much money you earned this year, last year and potentially next year. Youll need an estimate of next years income if youre applying in September, October, November or December.
Similar to the above section, you should also indicate on your application if any of these conditions apply to you:
- Youve been unable to work because of injury, illness or another condition at any point within the past 14 months.
- Youve qualified for a pension or an annuity from a federal or state government employer.
- You or your spouse have ever worked for the railroad industry in any capacity
- Youve earned any Social Security credit under the social security system of another country
Adults Disabled Before Age 22
An adult who has a disability that began before age 22 may be eligible for benefits if a parent is deceased or starts receiving retirement or disability benefits. We consider this a childs benefit because it is paid on a parents Social Security earnings record.
The disabled adult child including an adopted child, or, in some cases, a stepchild, grandchild, or step grandchild must be unmarried, age 18 or older, have a disability that started before age 22, and meet the definition of disability for adults.
It is not necessary that the disabled adult child ever worked. Benefits are paid based on the parents earnings record.
- A disabled adult child must not have substantial earnings. The amount of earnings we consider substantial increases each year. In 2021, this means working and earning more than $1,310 a month.
Some Publications That Will Give You More Information On Disability Benefits
The Disability Starter Kit will help you get ready for your disability interview or online application. Kits are available for adults and for children under age 18.
The starter kits provide information about the specific documents and the information that we will request from you.
The kits also provide general information about the disability programs and our decision-making process.
Here are some additional resources with information on disability benefits:
- Disability Evaluation Under Social Security – Medical criteria for evaluating Social Security disability claims
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Social Security Cards And Noncitizens
All U.S. citizens are eligible for SSNs. In addition, noncitizens authorized to work in the United States are eligible for SSNs. Noncitizens eligible to work in the United States include those who are admitted to the United States permanently and are often referred to as immigrants , and those who are admitted temporarily .
Social Security cards issued to noncitizens who are residing permanently in the United States are identical to those issued to U.S. citizens. Social Security cards issued to noncitizens who are in the United States temporarily bear the inscription, “VALID FOR WORK ONLY WITH DHS AUTHORIZATION.” SSA also issues SSNs to noncitizens not authorized to work if the noncitizen is legally in the United States and needs an SSN to receive state or federal benefits or services.26 SSNs issued for this purpose bear the legend, “NOT VALID FOR EMPLOYMENT.”
Importantly, the SSN issued to a noncitizen does not change if the noncitizen adjusts status . Although the noncitizen is supposed to report any change of status to SSA, this does not always occur. As a result, it is possible that some U.S. citizens have Social Security cards with the inscription, “VALID FOR WORK ONLY WITH DHS AUTHORIZATION.”
Before You Apply For Your Retirement Benefits
Before you apply for retirement benefits, there are certain Social Security basics you need to know about:
Your full retirement ageDepending on your birthdate, that may be between age 66 and 67. This could affect the amount of your benefits and when you want your benefits to start.
When you can start benefitsYou may start receiving benefits as early as age 62 or as late as age 70.
Spousal income and SSNBefore applying for social security benefits, its important to understand how marriage affects your retirement payments.
Benefits are reduced for ageYour monthly benefits will be reduced if you start them any time before full retirement age.
Working while you receive benefitsIf you elect to receive benefits before you reach full retirement age, you should understand how continuing to work can affect your benefits.
Delayed retirement creditsDelayed retirement credits may be added to your benefits if they start after your full retirement age.
Life expectancyIf you live to the average life expectancy for someone your age, you will receive about the same amount in lifetime benefits whether you choose to start receiving benefits at age 62, full retirement age, age 70 or any age in between. However, a lot of us will live much longer than the average retiree, and most women live longer than men. More than one in three 65 year olds today will live to age 90, and more than one in seven will live to age 95.
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Make Use Of The Comment Section
A potential Social Security beneficiary needs to always use the comments section close to the end of the application to outline what their specific intentions are. If they are attempting to file a restricted application, then they need to state this here.
If the applicant is trying to collect the divorced spouse benefits at their full retirement age and then, at a later date, switch to their own down the road, this needs to be put in the comments. This section is designed for you to outline your intent in case theres a problem in the processing.
An Example Of Taxed Benefits
Lets say you receive the maximum Social Security benefit for a worker retiring at FRA in 2021: $3,148 per month. Your spouse receives half as much, or $1,574 a month. Together, you receive $4,722 a month, or $56,664 per year. Half of that, or $28,332, counts toward your combined income for determining whether you have to pay tax on part of your Social Security benefits. Lets further assume that you dont have any nontaxable interest, wages, or other income except for your traditional individual retirement accounts required minimum distribution of $10,000 for the year.
Your combined income would be $38,332half of your Social Security income, plus your IRA distributionwhich would make up to 50% of your Social Security benefits taxable, because youve exceeded the $32,000 threshold. Now, you may be thinking, 50% of $56,664 is $28,332, and Im in the 12% tax bracket, so the tax on my Social Security benefits will be $3,399.84.
Fortunately, the calculation takes other factors into account, and your tax would really be a mere $225. You can read all about the taxation of Social Security benefits in Internal Revenue Service Publication 915.
Ask A California Disability Lawyer: Can I Apply For Ssdi By Myself
We often try to do things by ourselves instead of hiring professionals. Sometimes its because of a can-do attitude, and sometimes we just hope to save a little money. But the problem is that professionals have more in-depth knowledge. They know how to handle problems when they arise. For example, you might need to apply for benefits like Social Security Disability Insurance . The forms are online, so it should be easy, right? If you are wondering if you can apply for SSDI by yourself, ask a California disability lawyer.