Does a Workers’ Compensation Settlement Affect Social Security Disability?
According to the National Safety Council (NSC), there were 4.64 million work-related medically consulted injuries in 2019. In addition, 4,572 workers died on the job from a preventable injury. In spite of increased awareness surrounding workplace safety, 2019 was the second consecutive year that preventable workplace deaths increased by 2%.
For many workers, getting injured at work is an unfortunate setback, but many go on to make a full recovery and get back to their livelihoods. For others, though, suffering a workplace injury may mean a long-term rehabilitation process or even permanent disability. Filing for disability benefits along with payments from a workers’ compensation settlement may help you stay afloat, but there may be limitations as to how much cash assistance you can receive from these programs. Find out more about workers’ comp and disability from the legal team at Social Security Disability Advocates USA.
Can I Get Workers’ Comp and Disability at the Same Time?
Workers may be able to receive a workers’ compensation settlement (either as regular payments or as a lump sum) and also collect Social Security Disability Insurance (SSDI) benefits concurrently. Both of these are public programs, but they are run by different entities and have different requirements to qualify for benefits.
Workers’ compensation is overseen by individual U.S. states, while Social Security disability is run by the Social Security Administration, a federal program. Depending on the state you live in, you could qualify for assistance from one, both, or neither program. In addition, you may also receive disability benefits from other private and public sources, such as a private pension, Veterans Administration benefits, state and local government benefits, or Supplemental Security Income (SSI).
Will a Workers’ Comp Settlement Decrease My Disability Benefits?
A workers’ compensation settlement does carry the possibility of reducing the amount of monthly disability benefits you can qualify for from the SSA. Whether or not this will affect you depends on several factors, including how much your workers’ comp settlement is worth and the amount of your average monthly earnings prior to being injured on the job.
To figure out if and by how much your SSDI benefits may be reduced, add the amount of your monthly disability benefits from the SSA, your workers’ compensation payment, and other public disability payments you receive. (Private disability insurance and certain public sources like Supplemental Security Income or VA benefits don’t count towards this total.)
If the total amount of your monthly disability payments exceeds 80% of your average current earnings before you became disabled, your SSDI benefits will be reduced accordingly.
What if I Received a Lump Sum Workers’ Comp Settlement?
Not everyone who receives workers’ comp benefits collects them in installment payments. In some cases, it may be more beneficial for you to accept a one-time lump sum payment for your workers’ compensation claim. If this is the case, then how does workers’ comp and disability affect your monthly allowance?
Most of the time, the SSA will convert your lump sum settlement into monthly installment payments for the purpose of figuring out whether or not you’re surpassing the 80% limit of average current earnings. If, for example, you had been receiving $1,100 per month in workers’ compensation and then took a lump sum payment of $22,000, the SSA will likely calculate the equivalent monthly payment of $1,100 for the next 20 months ($22,000 / $1,100 per month = 20 months).
Will My SSDI Be Permanently Reduced Because of Workers’ Comp?
The offset of SSDI benefits to accommodate either a lump sum payment or monthly payments of a workers’ comp claim may affect your finances for a time, but this reduction in benefits is not permanent. As soon as your workers’ compensation runs out, you can notify the Social Security Administration and your monthly benefit will be increased, so long as nothing else has changed in terms of your disability.
If your workers’ comp does not run out, your benefits will change once you reach full retirement age. At this point, you will begin receiving regular Social Security benefits in lieu of SSDI benefits, and your monthly payments should increase to 100% of your maximum possible benefit.
Need Help with Workers’ Comp and Disability?
Trying to figure out how your workers’ compensation settlement will affect your Social Security disability benefits on your own can be tricky. Both programs are handled by different entities and have different rules for qualifying. In addition, your workers’ compensation settlement agreement may have its own stipulations as far as how your SSDI benefits are offset.
To get help with applying for disability benefits, calculating your average current earnings, and planning for your financial future, contact a Social Security disability lawyer today. Our law firm offers free initial consultations to help you sort out fact from fiction when it comes to qualifying for and maximizing your monthly SSDI benefits.
Our experienced attorneys will collaborate with your workers’ comp representative to make sure you’re getting fair compensation from both your employer and the Social Security Administration. And, should you also need legal assistance to complete your workers’ comp claim, we can also connect you with a qualified workers’ compensation attorney.
Social Security Disability Advocates USA is available around the clock 24/7 to take your call at 602-952-3200. You can also get in touch with a representative online right now by using our LiveChat service. To request your free, no obligation consultation, call today or fill out this simple request form.
