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Social Security approved me for disability benefits, now what?

Social Security Disability Insurance and Social Security Insurance are the two benefit programs that a disabled person can submit a claim for. While both benefit programs are for disabled individuals, they slightly differ in the requirements. Social Security Insurance(SSI) are for individuals who have not worked but are disabled and have little to no income or resources. Social Security Disability Insurance(SSDI) are for individuals that paid FICA taxes over many years. So for this program, you do not need to meet income limits in order to qualify. A finding of disability and the required work earnings are sufficient.

It may have been a long and frustrating road to get to this point but you are finally here. Your decision, may it be fully or partially favorable is now a reality. You are given back your independence and now know that you will have the ability to pay bills and buy the things that you need. Now, you’re wondering how long will it take to get your money. Unfortunately, you may have to wait another 1-3 months before you receive your first payment.

Social Security Supplemental Income(SSSI) will consider your resources such as spousal income, cash, bank accounts, stocks personal property, vehicles, life insurance, and anything that can be exchanged for cash. Social Security Disability Insurance(SSDI) will consider other employment or disability money received during the time your claim was pending such as, unemployment benefits, workers’ compensation, or long term or short term disability payments. Social Security will have to verify all sources of income before sending you your first check. However, being upfront and having these documents readily available could be of benefit in terms of speeding up this process.

 

For more information, please contact the attorneys at Hoglund, Chwialkowski, & Mrozik PLLC.

By Shana Knotts

Student Loans and Disability

Many people applying for Social Security disability have financial obligations that are put on hold during the determination process. One of these affecting more and more applicants are student loan payments. If you are approved for Social Security disability, you may be eligible to have these loans discharged. The U.S. Department of Education has a fairly simple process for determining disability, and once you meet their standards, your federal student loans may be discharged. Private loans are typically not eligible for this process, and you would need to contact your individual loan company to find if you are eligible for any other disability discharge.

After Social Security finds you disabled, make a copy of the determination letter laying out your benefits as well as when your next disability review date is, typically scheduled for five to seven years after the approval. Submit this letter to the Department of Education, along with the other forms required, available on their web site, www.disabilitydischarge.com. They may temporarily suspend your loan payments while deciding whether you qualify for loan discharge.

Once the discharge is approved, there are other requirements that must be met, such as your income must remain below a certain level, you may not apply for any other federal student loans, or you must continue to be disabled under Social Security’s rules. If these are not met, the loans may be reinstated. Keep in mind you may be responsible for any tax burden related to the discharge of the loans. Typically, the discharged loan amount is reported to the IRS, and may be considered income to you, the tax payer.

If your disability case is pending with Social Security, then you may be able to apply for a loan discharge before they find you disabled. If you have a supportive doctor that is willing to complete the necessary certification paperwork, showing that your condition may either result in death, has lasted for a continuous period more than 60 months, or can be expected to last more than 60 months, this may be sufficient for the Department of Education to discharge your loans. The same post-approval requirements would apply.

If you are receiving Disability Income or Supplemental Security Income from Social Security, and your federal loans are approved for discharge, this will not affect the benefits you receive.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Social Security Disability and Self-Employment

When Social Security receives a claim for disability benefits, the first question is whether the claimant performed Substantial Gainful Activity (SGA) during the alleged period of disability. If so, the claimant is ineligible for benefits during that time. SGA is generally defined as “work that involves doing significant and productive physical or mental duties, and is done (or intended) for pay or profit.” 20 CFR § 404.1510. Each year Social Security formulates a dollar amount that is used as the benchmark for SGA. In 2016 the amount is $1,130 per month and in 2015 it was $1,090. If this amount is or was exceeded, the earnings are presumed to be SGA. Gross earnings through employment can be easily compared to these benchmarks, but earnings through self-employment require further analysis.

The applicable rules are located in sections 404.1080 through 404.1096 and Social Security Ruling 83-34. The ruling should be consulted first for a general overview. Social Security may find that self-employment constitutes SGA under one of three tests:

  1. Under the Significant Services and Substantial Income test, both elements must be met. The significant services element is met if the claimant is a sole proprietor or, if not, performing more than half of the duties of the business or more than 45 hours per month of work. For a farm landlord, the question is whether he or she “materially participates,” not through an agent. The substantial income element is met if the claimant’s average monthly net income (countable earnings) reaches the benchmark amount; if the claimant’s livelihood derived from the business is the same as before he or she became disabled, or; if the claimant’s income is comparable to that of unimpaired individuals in a same or similar business in that community. If this test is not met, Social Security proceeds to the next two tests.
  2. Under the Comparability of Work test, the work is SGA if it is comparable in all relevant factors to that of unimpaired individuals in a same or similar business in the same community. Relevant factors include hours, skills, energy output, efficiency, duties and responsibilities.
  3. Under the Worth of Work test, the work is SGA, even if it is not comparable, if it is clearly worth more than the SGA benchmark amount when considered in terms of its value to the business or when compared to the salary an owner would pay to an employee for such duties in that business setting.

 

This is a general overview and the authorities cited above should be consulted for each individual situation. There are several additional details and nuances further explained in these sources. If your claim for Social Security Disability involves self-employment earnings, consider enlisting the help of a good attorney to interpret these rules and persuade social security that they operate in your favor.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Overpayments and Social Security

Social Security overpayment. How does it happen and what can you can do about it? There are things that will be your responsibility even after your claim is approved but, we will discuss that a little later. So how can you be overpaid you ask? It is true that Social Security is a Federal Agency and they have access to your employment history or earnings if you will. Well, there are other things that may play into how your income is determined by Social Security. Let’s look at one possible scenario.

You have been approved for Supplemental Security Income more commonly known as SSI. This is a needs based program. Which means that it is based on income and assets. Assets are things that you own like a car, cabin or savings bonds to name just a few. So now let’s add to that, that your family helps you out by paying your rent and utilities and you didn’t let Social Security know that. Social Security is not privy to items that you are receiving from family and/or others if you do not make them aware of them. But under Social Security rules, your family’s assistance with rent and utilities is considered a gift or as Social Security calls it an in-kind payment and looked at as unearned income and counts toward your total income when calculating your SSI payments. Your total income can only be up to a certain amount gross (meaning before taxes are taken out) to qualify for Supplemental Security Income (SSI).

Now take into account, that Social Security may only review your claim every three years or so. You guessed it, you now may have an overpayment issue with Social Security because during their claim review the fact that your family has been helping out has now come to light. Now Social Security has to refigure what you should have been getting paid and the overpayment will need to be paid back. If the amount of in-kind monies take you over the total income threshold allow by Social Security for an extended period of time, your benefit might be stopped altogether once the overpayment has been taken care of.

Remember that there are many different scenarios that might end in a person being over paid. Before you panic, first make sure that you were truly overpaid. Social Security can make errors too. Then even if you were overpaid, there are ways that you can get the overpayment waived. Social Security should be able to get you the information on how to appeal or try to get a waiver for your overpayment or here is a link that might be of assistance. https://www.socialsecurity.gov/pubs/EN-05-10098.pdf

I want to leave you with this thought. If you are receiving benefits from Social Security that are need based (SSI) you need to remember that you are responsible to let Social Security know if there are changes in monies you receive. Since they might count toward your total income and thus may cause your payment amount to change. This will help you in not being overpaid and wondering how you are going to repay the money. If you are in doubt whether Social Security needs to know about it or you just do not understand something that Social Security sends you, ask them to explain or contact an attorney to get assistance. Overpayments add up quickly and can become overwhelming to deal with along with your disability.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Even Pro Athletes File Bankruptcy

Many of us know the tale of Michael Vick: one of the most dynamic and talented football players of our generation, who earned more than $200 million dollars over his career only to see it all disappear. Vick was forced to file bankruptcy in 2008 after he found himself more than $20 million in debt, with no real income stream to pay them off (he was banned from the NFL after being convicted of dog fighting and animal cruelty charges in November 2008). Vick is only one of hundreds of pro athletes that have gone broke. A Sports Illustrated article form earlier this year reported that 78 percent of NFL players face bankruptcy or serious financial stress within two years of leaving the game; 60 percent of NBA players face the same financial strife within five years. Why is this?

Pro athletes make millions and sometimes hundreds of millions of dollars over their careers, so it is hard for those of us who will never make close to that understand how athletes could ever find themselves in financial difficulty. One big problem is trust. A lot of athletes came from nothing and do not trust anyone to give tax, legal, and financial advice that could ensure a lifetime of financial stability. Other athletes have the problem of trusting the wrong people and are defrauded of their millions.

Another large problem is pressure from friends and family. Athletes feel obligated to buy expensive houses and cars for those that helped them go pro. They also get a lot of pressure from family and close friends to invest in businesses even when that friend or family member may not have any idea how to run a business. Michael Vick is a prime example of this. He bought a number of cars for friends and family members, a house for his mom, a number of houses for himself. This, among other things, all led to his bankruptcy in 2008. Fortunately for Vick, he landed a $100 million contract the Philadelphia Eagles to help pay off his debts and start over.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Sometimes Income Taxes Are Dischargeable In a Bankruptcy

As a general rule taxes are nondischargeable in a bankruptcy. However, in some circumstances, income taxes can be discharged in a bankruptcy. In order for income taxes to be eligible for a discharge in a bankruptcy, the taxes must have been filed for at least two years and the taxes must have been due and owing for at least three. For example, 2007 taxes became due and owing in 2008 and they can therefore be discharged after April 15th in 2011 assuming that they were filed on time in 2008. There are some qualifications to this. If certain events have occurred during the three year period, the taxes will not be discharged. For example, an assessment will cause the waiting period to be extended. There are a variety of other tolling events. It is best to get a professional opinion regarding the dischargeability of taxes before assuming that a bankruptcy will wipe out the obligation.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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