Can I get both SSDI and Social Security Retirement Benefits?

When making decisions about whether to continue working or take time off after a cancer diagnosis, it is important to understand your options so that you can make an educated decision. Disability insurance (e.g., SSDI) is a way to replace your wages if you need to take time off work because of a medical condition. Can I get SSDI and Social Security?

For an overview of disability insurance options, read our Quick Guide to Disability Insurance, or watch our recent webinar on Taking Time Off & Paying For It. One option is Social Security Disability Insurance (SSDI), which is one of the two federal long-term disability programs.

Depending on your age, you may also be considering retiring early or at your full retirement age and receive Social Security retirement benefits. We often get asked:

“Can you get both Social Security Disability Insurance (SSDI) and Social Security retirement benefits?”

For the most part, the answer is no. If you are receiving SSDI because you have a disability and are unable to work, you are effectively receiving your retirement benefits early. If your disability continues through to the time when you would normally retire, your SSDI benefit will just automatically convert to Social Security retirement benefits and the amount of money you receive each month will not change.

The Exception
There is one exception and that is early retirement. You can file for early retirement (which you are eligible for at 62), while you are waiting for your disability claim to be approved. You would receive a reduced retirement benefit (currently 25% less than your full retirement benefit amount) right away. If you are approved for SSDI, you will begin to receive your full retirement amount. You could also receive prorated retroactive payments for any time that you were determined to be disabled and were receiving reduced benefits.

The Risk/Reward of Early Retirement
If you take early retirement and then never apply for, or are never approved, for SSDI, you will receive a reduced monthly retirement benefit amount for the rest of your life.  That’s the risk.

But if you are approved for SSDI for a disability that began before your early retirement, your benefit payment will rise back up to the full amount. Furthermore, the Social Security Administration will enact a “disability freeze” on your earnings.  This is important because the amount of your retirement benefits and SSDI benefits are determined by your earnings record over your lifetime.  Zero earning or low earning years reduce the amount of benefits that you are eligible to receive.

If you are found to have a disability that began after you took early retirement, you would not get the benefit of a “disability freeze.” Furthermore, you would receive the higher SSDI payments only until the time that you turned your full retirement age, then your payments would return to the reduced early retirement amount for the remainder of your life.

Understanding the rules is the first step in getting the maximum benefits for which you are eligible.

Taking Hardship Withdrawals From Retirement Plans

Do you have a 401k or 403b retirement plan at work?

seniorsIf you do, then you may be able to take out a loan from your retirement plan or make a hardship withdrawal. Plans are not required to offer either option, but offer one or both:

  • Loans: these are temporary withdrawals that must be paid back within five years, with interest. If not paid back within five years, it is treated as a distribution and if the participant is not at least 59.5 years old, then they must pay a 10% penalty on top of income taxes on the withdrawn funds.
  • Hardship withdrawals: these are withdrawals made for specific hardship reasons. The amount withdrawn is subject to income tax and if the participant is not at least 59.5 years old, then they must pay a 10% withdrawal penalty. The amount withdrawn may not exceed the amount needed to satisfy the hardship. For example if you have a $10,000 medical bill you need to pay, you cannot take out more than $10,000.

You may be required to first take a loan before taking a hardship withdrawal.

Current rules

The IRS allows an employee to withdraw money from their employer-sponsored 401k or 403b plan:

  1. To pay for unreimbursed medical expenses for plan participants or their spouses or dependents
  2. To purchase the plan participant’s principal residence, excluding mortgage payments
  3. To pay college tuition and related post-secondary education cots such as room and board for the next 12 months for a plan participant, spouse, depend or child who is no longer a dependent
  4. To make payments to prevent eviction or foreclosure on a mortgage of a principle residence
  5. To pay funeral expenses for plan participants and their spouse, children, dependents, or beneficiary
  6. To pay for repairs to a plan participant’s principal residence if the repairs fall under the IRS’s definition of casualty loss.

For more information: www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-hardship-distributions

There is also a requirement that when you make a withdrawal, you have to wait to make any contributions to your retirement plan for six months.  So that means if your employer matches any money that you contribute to your plan each paycheck, then you are not only missing out on the tax benefits of your contributions, but you are also missing out on the money that your employer would have matched!

New rules

Under the latest budget law passed on February 9, 2018, it is now easier to make a hardship withdrawal from employer-sponsored retirement plans.

Beginning in 2019, employees:

  • who make hardship withdrawals are no longer required to stop making contributions to the plan for six months, which allows employees to keep benefitting from an employer match.
  • cannot be required to first take a loan from their plan before making a hardship withdrawal
  • can now withdraw the plan sponsor’s qualified nonelective contributions, qualified matching contributions, and profit-sharing contributions

Taking loans or hardship withdrawals from retirement plans may be useful way for people diagnosed with cancer to find some financial relief. However, it is important to understand how the rules apply to you and to speak with a financial planner or an accountant before making any financial decisions.

Congress Takes Steps to Undermine the ADA

Many have heard of the Americans with Disabilities Act (ADA), but may not know all of the details. The ADA is the federal law that protects people with disabilities from discrimination in a variety of ways.

The ADA was passed by Congress in 1990, more than 28 years ago.  Congress improved protections in the ADA in 2008 by passing the ADA Amendments Act.  Most people are familiar with its physical access requirements, such as having accessible parking spots, ramps into buildings, and accessible restrooms. However, despite its age, many who are protected by the ADA, don’t know it.

In addition to physical access requirements, the ADA also provides protections for people with disabilities in the workplace.  Title I of the ADA requires that covered employers provide eligible employees with protection against discrimination and rights to privacy, as well as access to reasonable accommodations. For more information about these protections and how they apply to individuals diagnosed with cancer AND their caregivers, visit: http://TriageCancer.org/employment.

The ADA also provides protections for children, adolescents, and young adults with disabilities in school, including those diagnosed with cancer.

Approximately 36% of adults ages 65 and over have some type of disability. Learn 7 facts about Americans with disabilities.

This month, Congress took a step to erode the protections in the ADA.  The U.S. House of Representatives passed (252-192) the ADA Education and Reform Act, which forbids individuals with disabilities from suing a business for violating their rights under the ADA, unless they first:

  1. Provide written notice to the business that they are in violation of the ADA
  2. Wait 6 months to see if the business fixed the violation

Opponents of the bill argue that this allows businesses to refuse to comply with the ADA, until an individual with a disability sends them a written complaint and then they get another 6 months to comply. Meanwhile, the individual with a disability is unable to access that hospital, doctor’s office, restaurant, store, movie theater, hotel, or other public place.

Advocates for people with disabilities are skeptical that businesses need more time to comply with a law that was enacted almost thirty years ago.

In what other area of society do we allow a business to ignore a law until someone sends them a written complaint?

Oh, wait.  That sounds a lot like health insurance appeals.

The bill now awaits a vote in the U.S. Senate. For more information about how to be an effective advocate, visit http://triagecancer.org/advocacy. Stay tuned.

 

 

 

The Twelve Sites of Social Security

By Essie Landry
Social Security Public Affairs Specialist in Sierra West Area

Gathering with family and friends during the holiday season reminds us we’re part of aThe Twelve Sites of Social Security strong community. And sometimes, in the spirit of the season, we break into song. Our take on “The Twelve Days of Christmas” — a holiday favorite since 1780 — highlights the national community we care for all year long. We call it “The Twelve Sites of Social Security.”

For the first site of Social Security, we give to you: our home page, www.socialsecurity.gov. It’s the place to go for all things Social Security. Everything you could want — from online services and benefit screening tools to publications and frequently asked questions — you can find all these and more on this site.

For the second site of Social Security, we give to you: our hub for Social Security news and updates at our blog, Social Security Matters at blog.socialsecurity.gov.

For the third site of Social Security, we give to you: an easy way to learn how to replace your Social Security card at www.socialsecurity.gov/ssnumber. And in some states, you can replace it online at www.socialsecurity.gov/myaccount!

For the fourth site of Social Security, we give to you: an online application for retirement benefits that you can complete and submit in as little as 15 minutes at www.socialsecurity.gov/applytoretire.

For the fifth site of Social Security, we give to you: five estimates of your future Social Security benefits! Or as many estimates as you would like using different scenarios. Get instant, personalized estimates of your future benefits at www.socialsecurity.gov/estimator.

For the sixth site of Social Security, we give to you: a convenient way to apply for disability benefits at www.socialsecurity.gov/applyfordisability.

For the seventh site of Social Security, we give to you: fun and informative videos on our YouTube channel at www.youtube.com/user/socialsecurityonline.

For the eighth site of Social Security, we give to you: Extra Help with Medicare prescription drug plan costs. You can learn more and apply for a subsidy online at www.socialsecurity.gov/prescriptionhelp.

For the ninth site of Social Security, we give to you: our convenient publication library with online booklets and pamphlets on numerous subjects, at www.socialsecurity.gov/pubs.

For the tenth site of Social Security, we give to you: one of our most popular social media outlets, our Facebook page. This is where we engage thousands of customers and you can join the conversation at www.facebook.com/socialsecurity.

For the eleventh site of Social Security, we give to you: answers to your Social Security related questions at our Frequently Asked Questions page at www.socialsecurity.gov/faq.

On the twelfth site of Social Security (and we saved the best for last): open your own personal my Social Security account, which will enable you to verify your earnings, get future benefit estimates, obtain benefit verification letters, update your Social Security information, and more at www.socialsecurity.gov/myaccount.

And a partridge in a pear tree! Find all of this and more (except the partridge and pear tree) at www.socialsecurity.gov.

Taking FMLA Leave During the Holidays

The Family & Medical Leave Act (FMLA) allows eligible employees to take up to 12 FMLA-During-Holidaysweeks of unpaid, job-protected leave, per year.  How this 12 weeks of time off gets counted by employers is a frequent question that we receive.  Figuring this out can be especially confusing if your FMLA leave takes place over the holiday season, where there are usually a number of paid company holidays. So, when trying to calculate your time off when taking FMLA leave during the holidays, this is how it breaks down:

  • If your company pays for 1 day of a company holiday (like Thanksgiving, for example), but you take the other 4 days off during that week as well, the entire week (5 days) would count towards your 12 weeks of FMLA leave.
  • However, if you work at least 1 day that week, your paid company holiday will not count towards your FMLA leave. For example, if you work Monday but then take the rest of the week off (which includes 1 day of a paid company holiday on Thursday), then only Tuesday, Wednesday, and Friday will count against your FMLA leave.
  • If your company shuts down for 1 or more weeks (e.g., the week between Christmas and New Year’s), that time will not be counted against your FMLA.

Knowing how paid holidays interact with the FMLA is the best way to ensure you make the most of your FMLA leave. For more information on the FMLA, including who is an “eligible employee” and how the FMLA works with other benefits, visit our website and read our FMLA Quick Guides. And, we hope that you have a happy and healthy holiday season!

FAQs About Social Security Survivors Benefits

Today we are pleased to share some very useful information from the Social Security Administration about the right of survivors to collect a loved ones’ Social Security benefits.

  1. Who can get Social Security survivors benefits and how do I apply?

Response: When you die, members of your family could be eligible for benefits based on your earnings. You and your children also may be able to get benefits if your deceased spouse or former spouse worked long enough under Social Security.

  1. Who can get survivors benefits?

Response: Widows and Widowers
A widow or widower can receive benefits

  • at age 60 or older.
  • at age 50 or older if disabled.
  • at any age if she or he takes care of a child of the deceased who is younger than age 16 or disabled.

Divorced Widows and Widowers
A divorced widow or widower can receive benefits

  • at age 60 or older if the marriage to the deceased lasted at least 10 years.
  • at age 50 or older if disabled and the marriage to the deceased lasted at least 10 years.
  • at any age if she or he takes care of a child of the deceased who is younger than age 16 or disabled.

Unmarried children
Unmarried children can receive benefits if they are:

  • younger than age 18 (or up to age 19 if they are attending elementary or secondary school full time);
  • any age and were disabled before age 22 and remain disabled.

Under certain circumstances, benefits also can be paid to stepchildren, grandchildren, stepgrandchildren or adopted children.

Dependent parents
Parents age 62 or older who received at least one-half support from the deceased can receive benefits.

One-time lump sum death payment
A one-time payment of $255 can be made only to a spouse or child if they meet certain requirements. Survivors must apply for this payment within two years of the date of death.

  1. How do I apply doe Survivors Benefits?

Response: You cannot apply for survivors benefits online. To report a death or apply for survivors benefits, please

  1. Where can I find more information about Survivors Benefits?

Response: You can find more information about Survivors benefits by accessing the following links: Survivors Planner: How You Apply For Survivors Benefits
Survivors Planner: If You Are The Worker’s Widow Or Widower
Survivors Benefits
Social Security Survivors Benefits: Protection You And Your Family Can Count On

  1. What Should I do when someone dies?

Response: Notify Social Security as soon as possible when someone getting benefits dies. In most cases, the funeral director will report the person’s death to Social Security. Give the funeral director the deceased’s Social Security number so he or she can report the death.

See How Social Security Can Help You When A Family Member Dies for more information.

  1. How much do survivors get in benefits?

Response: We base survivors benefits on the amount the deceased worker earned during his or her lifetime.

See Survivors Planner: How Much Would Your Benefit Be? for more information.

  1. Who can get a lump-sum death benefit?

 Response:  We may pay a lump-sum death benefit of $255 to:

  • A spouse who was living with the deceased person at the time of death; or
  • A spouse or a child who, in the month of death, is eligible for a Social Security benefit based on the deceased person’s record.

More Information

Survivors Planner: A Special Lump-Sum Death Payment

Information You Need To Apply For Lump Sum Death Benefit – Form SSA-8

     8. Can Social Security payments go to the estates of deceased beneficiaries?

Response: A deceased beneficiary may have been due a Social Security payment at the time of death. We may pay amounts due a deceased beneficiary to a family member or legal representative of the estate.

See Claim For Amounts Due In The Case Of Deceased Beneficiary – Form SSA-1724 for more information.

 

Making the Most of Ticket to Work

Tai Prohaska, MPH
Manager of Strategic Alliances, Allsup

If you had to stop working due to cancer, and were awarded Social Security Disability Ticket to WorkInsurance (SSDI), you could benefit from Social Security’s Ticket to Work program. Research shows that the longer a person is detached from the labor force, the less likely it is they will return to work. If and when you are medically able to try some kind of work, this program makes it easier for you to test whether you are ready to work, without the fear of losing your SSDI and Medicare benefits.

Many people are able to earn much more through work earnings than they receive in SSDI benefits, and those earnings go toward your future Social Security retirement benefits.  In addition, there are important personal rewards, including retrieving an important part of who you are through your work, discovering purpose in your day and belonging with others, and providing vital security for your future.

To make the most of the program, it helps to understand these Ticket to Work basics:

  • Employment Networks (ENs). More than 600 ENs across the U.S. offer a range of free support services through the Ticket program. Some ENs serve specific populations, while others provide specialized support services. You can click here to search for an EN. You can also visit Allsup Employment Services, which supports individuals with exploring their interests, understanding their skills, and pursuing their employment options. Once employed, they provide support to address issues such as improving energy and stamina for a full-time job, discussing job accommodations with employers and complying with Social Security’s reporting processes, to protect benefits for the long-term.
  • Trial Work Period (TWP). You can keep your SSDI cash benefits while testing your ability to work for nine months.  You have a safety net where you can test your ability to work again and receive your full SSDI benefits in addition to your job earnings.
  • Extended Period of Eligibility (EPE).  After Your TWP ends, you will get full SSDI benefits for the first three months of this 36-month period in addition to your job earnings. After that, you are eligible to receive SSDI benefits for any month your job earnings drop below substantial gainful activity (SGA).  In 2017, SGA is $1,170 for non-blind individuals and $1,950 for blind individuals.
  • Continuing Medicare Coverage. After your TWP ends, your Medicare coverage continues for up to 93 consecutive months. You still receive coverage during this time even if your SSDI payments end.
  • Expedited Reinstatement of Benefits.  If you become unable to work again within five years after your EPE ends, you can request to have your SSDI benefits restarted without filing a new application.
  • Continuing Disability Review (CDR) Protection. Social Security periodically reviews disability claims to determine if you still qualify as disabled.  As part of the Ticket to Work program, you are exempt from medical CDR and your status remains unchanged.

If you are ready and medically able to return to work, taking advantage of the Ticket to Work program can help prepare you for success. To learn more, visit https://choosework.ssa.gov.

Volunteering While on FMLA – Risking Your Job?

We often get questions about what an individual is allowed to do while on leave under Volunteering-on-FMLAthe FMLA. For example, can you engage in contract work, work a second job, or volunteer on FMLA leave? Like many issues around work and cancer, there isn’t a one-size fits all answer.

The Family and Medical Leave Act (FMLA) is a federal law that allows eligible employees to take time off from work, for up to 12 weeks, because their own serious medical condition prevents them from working, or to act as a caregiver for a seriously ill spouse, child, or parent.

To be eligible for FMLA leave, individuals must have worked at their place of employment for a minimum of 12 months, and worked over 1,250 hours, in the last 12 months. Also, private employers must have more than 50 employees in order to be covered by the FMLA. For more information about the FMLA, take a look at our Quick Guide.

The FMLA does not expressly prohibit individuals from working another job while on FMLA leave (sometimes referred to as moonlighting, but we also know that many people regularly work more than one job). “Employers with established policies regarding outside employment while on paid or unpaid leave may uniformly apply those policies to employees on FMLA leave. Otherwise, the employer may not restrict your activities.” Keep in mind, some states may have laws that might impact an employee’s ability to work other jobs while on leave.

If you are taking time off under the FMLA because a medical condition keeps you from working, and you chose to volunteer or work another job while on FMLA, and your employer finds out, they are allowed to ask questions regarding your responsibilities and your ability to work. Employers may question your responsibilities at you other job, to ensure that they are not similar to what you do while working for them. Therefore, it may be in your best interest to check with your employer about their policies around working another job or volunteering while out on FMLA leave.

For more information, visit https://www.dol.gov/whd/regs/compliance/1421.htm.

How Does Using Paid Time Off Impact an SSDI Application?

If you are applying for Social Security Disability Insurance (SDDI), you may wonder if you have to stop working before you apply. You may also wonder if you are allowed to use your sick time, vacation time, or some other paid time off.

The first thing that the Social Security Administration (SSA) looks at when determining if you meet their definition of having a disability, is whether you are currently working. SSA believes that if you are working, then you are able to work and do not have a disability. But there is a big difference from working 40 hours a month as a receptionist and working 160 hours a month as an attorney. Each year, the SSA establishes a dollar threshold amount, and if you make under that amount, you are not considered to be working, according to SSA. This threshold is called Substantial Gainful Activity (SGA).

In 2017, the SGA is $1,170 per month for individuals with a disability other than blindness. If you make more than the SGA, you will not qualify for SSDI and your claim will be denied. The SGA for blind applicants is $1,950 per month. These amounts are your gross earnings.

When determining your income, the SSA will only look at earnings derived from actual work activity in the month under consideration.  That means that sick days, vacation days, or other paid time off will not be considered.

So, if you worked 5 days in a month, and then took 15 sick days, only the 5 days of work will count towards the SGA threshold. If you work 2 weeks in a month (10 days) and then take the next 10 days off using accumulated vacation time, only the 10 days you worked will counts towards the SGA.

This is important, because it means that you can apply for SSDI, without having to first use up all your paid time off.  And, since there is a five-month waiting period for SSDI benefits to begin, you paid time off can help bridge that gap.

For more information about SGA and applying for SSDI, visit: https://www.ssa.gov/pubs/EN-05-10029.pdf or https://secure.ssa.gov/poms.nsf/lnx/0410505010.

People with Cancer are Stuck in the Disability Backlog

Tai Prohaska, MPH
Manager of Strategic Alliances, Allsup

Most people don’t know much about the Social Security Disability Insurance (SSDI) Disability-Backlogprogram until they have to stop working because of an illness or injury. Then, one of their first questions is, “Am I eligible?” They may qualify for monthly income (based on what they have paid into the system) and other benefits if they:

  • Are unable to work for at least 12 months or more, or their condition is terminal
  • Have paid FICA taxes for at least five of the last 10 years
  • Are over 21 and under full retirement age (65-67)

For more information about disability insurance options, read Triage Cancer’s Quick Guide to Disability Insurance.

While SSDI benefits can be useful, there are some barriers to getting access to these benefits:

  • It’s not easy to obtain benefits. Two-thirds of people who apply are denied and must go through an appeals process that can sometimes take years.
  • People are waiting an average 596 days for a disability hearing. Almost half of U.S. hearing offices now report waits of 600-plus days, including 14 offices whose times exceed 700 days. Click here for the average wait in your state.
  • After the hearing, people could wait an estimated 78 to 120 days to find out the judge’s decision.

The disability backlog was also an issue in 2009, when Allsup surveyed individuals going through the SSDI appeals process. Of those surveyed, 90% said they faced negative repercussions while waiting for their SSDI award. These included:

  • Stress on family – 63%
  • Worsening illness – 53%
  • Draining of retirement/savings – 35%
  • Lost health insurance – 24%
  • Missed mortgage payments – 14%
  • Foreclosure – 6%
  • Bankruptcy – 5%

Cancer is one of the top five categories of conditions that qualify someone for disability insurance benefits, according to the Social Security Administration (SSA). A 2013 study estimated that cancer accounted for 9% of all SSDI awards. Based on those numbers, we can only guess how many individuals with cancer are stuck in the SSDI backlog.

Banish the Backlog

One way individuals with cancer can improve their likelihood of avoiding the SSDI backlog is to get help at the very beginning of the process, starting with an eligibility assessment before they ever go to the SSA. Most people who apply through the SSA’s website for SSDI are denied. They don’t have enough work credits, do not submit adequate medical records, do not fill out SSA’s forms properly, or do not respond to the SSA’s requests for additional information. The process can be overwhelming and confusing.

Many websites offer tips on how to apply for disability. Allsup has a free online screening tool, empower by Allsup®, which also incorporates return-to-work information. Getting help with the initial application can mean the difference between getting benefits in a matter of months instead of years.

If you are stuck in the disability backlog and want to post your experiences and suggestions for tackling this problem, visit the Banish the Backlog Facebook page at www.facebook.com/banishthebacklog.