Social Security Disability Financial Advantages

Increased Social Security Retirement Benefits For every year that you are medically unable to work and do not "pay into the system," no earnings are factored into your Social Security record, even if you are receiving workers' compensation payments or benefits or under a long term disability insurance plan. This is known as the "zero wage-earner" status. Social Security calculates your retirement benefits based on a weighted average of the income that you earned over you working life. As a result, a significant amount of non-working years will result in zeros factored into your average and a substantially lower Social Security Retirement benefit. If the Social Security Administration (SSA) determines that you are disabled in accordance with the Social Security Act, your earnings record will be "frozen" for those years you were unable to be gainfully employed. This will protect your Social Security retirement benefits and could save you hundreds of thousands of dollars.

Health Insurance via Medicare Entitlement SSDI recipients are entitled to Medicare coverage after receiving SSDI benefits for 24 months. This inexpensive health insurance includes Part A (Hospital) at no charge and Part B (Medical) for a small monthly payment of $96.40 (2008).* For recipients who do not have health insurance, this benefit is of extreme importance.

* Roughly 96% of beneficiaries will pay $96.40 for Medicare Part B; the other 4% will be subject to a higher premium based on earnings greater than $82,000 per year ($164,000 for married couples).

Cost of Living Adjustment (COLA) Raises Your SSDI benefit will also increase every year, in keeping with COLA raises.

Trial Work Period In most cases, entitlement to SSDI benefits also allows you the opportunity to attempt to return to work for a period of up to nine (9) months while you still receive your full monthly SSDI benefit.

Tax AdvantagesThe majority of SSDI recipients receive their benefits tax-free. You should, however, consult with a tax professional to determine if this tax exemption applies to your individual situation.

Closed Period of Social Security Disability Benefits If you anticipate returning to work in the near future, but were unable to work for twelve or more months, you are entitled to apply for a closed period of SSDI.