The Social Security Administration’s (SSA) rules are often complex, especially when you draw income or benefits from other sources. You may be wondering, “Will disability benefits lower my pension?” Generally speaking, the answer is no.
That is because a pension is a guaranteed retirement plan into which your employer makes contributions during your working years. Your employer is legally obligated to pay out your pension as long as you meet your obligations for receiving it. This obligation usually requires a certain number of years of service.
Just because you start receiving disability in no way nullifies the agreement your employer made to pay out your pension benefits.
The bigger risk involves your pension income affecting your disability benefits. Depending on the disability program you qualify for, your pension payments may decrease your monthly benefit amount or disqualify you for benefits altogether.
The attorneys at the Disability Advantage Group, can help you understand how your pension may impact your disability benefits. Call 865-566-0800 today to schedule a free consultation.
What Are the Different Types of Disability Benefits?
Certain disability programs take the financial need of recipients into account. Too much pension income can push you above the income threshold and reduce or eliminate your benefits.
Whether your pension will affect your disability depends on the specific program for which you apply. The SSA administers two disability programs: Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI). These programs have several differences and, as such, your pension income will affect them in different ways.
Will My Pension Affect My SSDI Benefits?
The SSDI program is not a needs-based program. Instead, the SSA looks at your work history when determining your eligibility. Only people who have worked a sufficient amount, earned enough work credits, and paid into Social Security through their payroll taxes qualify for SSDI. You must also suffer from a medical impairment that leaves you unable to earn a substantial living.
If you have worked long enough and earned enough money to receive a pension, then, chances are, you have worked long enough and earned enough money to qualify for SSDI. Moreover, since the federal government taxes the vast majority of pension benefits, you are still paying into SSDI even when you stop working and start receiving pension benefits.
Your pension benefits should not affect your SSDI benefits in any way. Rare exceptions might occur if you receive a disability pension or certain civil service retirement benefits. Our attorneys can examine your situation and determine if any chance exists of your pension putting your SSDI benefits at risk.
Will My Pension Affect My SSI Benefits?
The other main Social Security disability program is SSI. While it, like SSDI, provides regular income to people with qualifying disabilities, it is a different program altogether.
Unlike SSDI, where benefits depend on the amount you have paid into the program, SSI is needs-based. To qualify, you must earn under a certain amount of income and have under a certain amount of assets or net worth.
The SSI program does not make you count all forms of income toward its limit. However, the SSA almost always considers pension benefits as unearned income and includes it when calculating your income. As a result, your pension can push you over the limit and disqualify you for benefits, especially if you receive other forms of income.
Even if your pension income does not make you ineligible for SSI, it can reduce your benefit amount. That is because SSI uses a system in which income from other sources offsets your disability income.
It is also helpful to note that SSI allows you to deduct and exempt certain expenses from your income. Even if you earn above the limit after accounting for your pension income, you might still qualify after taking advantage of deductions and exemptions.
Because the rules for SSI are hardly straightforward regarding income and expenses, it helps to speak with our experienced lawyers before applying for benefits. This is especially true if you receive pension income or expect to at some point. We can help you structure your household finances to give you the best chance of qualifying for SSI and receiving the highest benefit amount you can.
Call the Disability Advantage Group, at 865-566-0800 to Speak With an Attorney.
If you have a disability and cannot work, you deserve Social Security benefits to help pay your bills and support yourself. The challenge is the SSA has a reputation for being capricious and making arbitrary decisions.
The attorneys at the Disability Advantage Group, know how to win disability cases and have a track record of doing so for our clients. Whether you are applying for benefits for the first time or you have concerns about a change in benefits due to your pension income, call us for help. The consultation is free and we will answer all your questions and advise you on how to proceed. Call 865-566-0800 today.