Suffering an injury or illness that keeps you from working will turn your life upside down in an instant. You may immediately start to wonder how you will be able to pay the bills, pay for your medical care, and earn a living. The amount of money you can receive from Social Security Disability Insurance is not determined based on how financially sound you are or the severity of your injury or illness. The amount is based on how much income you’ve earned throughout your career prior to your injury or illness.
How Social Security Disability payments are calculated
The maximum benefit for monthly Social Security Disability Insurance payments in 2018 was $2,788. The Social Security Administration uses a weighted formula in an effort to calculate the monthly benefit paid to anyone who applies for this insurance, which is why every person’s amount is different.
The SSA reviews how much of your income has had Social Security tax paid on it. This is what the agency refers to as covered earnings. When the agency looks at your covered earnings over a period of years, it is known as your average indexed monthly earnings, or AIME. The agency then applies a formula to your AIME to determine the primary insurance amount, or PIA, which is the base amount used to set the monthly benefit you will receive.
There are fixed percentages taken into consideration by the agency when using the formula. The percentages for 2018 include the following:
- 90 percent of your first $895 of your AIME is added to the PIA
- 32 percent of your AIME between $885 and $5,397 is then added to the PIA
- 15 percent of your AIME that is more than $5,397 is added to the PIA
The SSA sends out a report on covered earnings every five years for people who are not currently disabled and receiving benefits. This report is sent every year to people who are 60 or older. You are also able to research your covered earnings history by using the SSA website. There is also an earnings estimator calculator on the SSA website that can help you determine your covered earnings amount for the future.
How payments can be reduced
Now that we’ve gone over how the SSA calculates the monthly amount of disability payments you will receive, we need to review how the amount can be reduced. Receiving payments from a policy that covers long-term disability will not affect the amount of your monthly payment from the SSA.
The monthly amount of your disability payment will be reduced if you are receiving payments from a workers’ compensation claim or temporary disability benefits paid by the state of Tennessee. How will your monthly disability payment be affected? For starters, you will be ineligible to receive more than 80 percent of the average amount of money you earned prior to your injury or illness. Benefits received from Social Security Insurance or Veterans Affairs insurance policies will not affect the amount of disability you receive each month.
How does the SSA determine if I am disabled?
The SSA will need to evaluate your case before issuing you monthly disability payments. Why? The SSA needs to make sure the disability you listed on your application is covered by the agency. What goes into determining if you are disabled? Check the following list:
- Are you working right now? If you are working when you file the claim and your average earnings are more than $1,180, you will not be considered disabled.
- Is your injury or illness severe? You will not be deemed to be disabled if the SSA does not view your injury or illness as one that interferes with your basic work activities.
- Is your injury or illness found in SSA documentation? Your injury or illness must be found in the SSA’s list of disabling medical conditions in order to automatically qualify for disability benefits. If your condition is not on the list, the SSA needs to determine the severity of your condition before you can move forward.
- Can you perform the work you previously performed? The SSA will not consider you disabled if you can still perform the work you performed prior to your injury or illness.
- Are you able to perform other types of work? If the SSA determines that you can adjust to perform some other type of work after taking into account your age, condition, prior work experience and education; you will not be considered disabled.
Do you have questions about Social Security Disability Insurance? It’s time to speak with an experienced attorney about your situation. Call the office of Shepherd and Associates, P.C. in Maryville at 865-225-9655 today to schedule a consultation or complete the contact us form on our website. We proudly serve clients in the East Tennessee area.