If you are disabled and unable to engage in substantial gainful activity, it is understandable that you are worried about how you will provide for your most basic needs, like housing, food and clothing. If you are considering applying for social security disability insurance (SSDI) or supplemental security income (SSI), or if you have already applied and are awaiting the SSA’s decision, you may be wondering what the maximum disability benefits you can expect to receive. The answer depends in part on the type of benefits you receive and the year you became disabled.
Determining Social Security Disability Benefits Payment
The amount of SSDI benefits varies amongst recipients. That is because the monthly benefit is based upon an applicant’s average annual lifetime earnings, beginning at age 21 and continuing through the year of eligibility (the year the applicant became disabled).
Average Indexed Monthly Earnings
The first step in determining the amount of the monthly SSDI benefit is to calculate the applicant’s average indexed monthly earnings (AIME). Annual earnings from age 21 through the second calendar year prior to the applicant’s disability are adjusted to present day wage levels; earnings for the year of disability and first year prior are not adjusted to present day levels. The highest years of earnings (up to five years may be dropped out) are then averaged and divided by the number of months in the calculation period.
Primary Insurance Amount
The AIME is then used to determine the recipient’s primary insurance amount (PIA), which is the amount of benefits he would receive if he elected to retire at normal retirement age. The PIA is the sum of three “bend points”, the value of which changes annually. When calculating PIA, the SSA uses the bend points from the year in which the applicant became disabled – not when he applied for benefits.
For 2015, the PIA is determined by adding:
90 percent of the first $826 of the AIME, plus
32 percent of the AIME between $826 and through $4,980, plus
15 percent of the AIME above $4,980.
Monthly Benefit Amount
The monthly benefit amount for an SSDI recipient is 100 percent of his PIA. In 2015, the maximum disability benefits paid under SSDI is $2,663. The estimated monthly average payment for all disabled works in 2015 is $1,165 ($1,976 for a disabled worker, spouse and one or more children).
SSI Benefits Amount
Monthly SSI benefits are a fixed payment that are adjusted for cost-of-living increases. The recipient’s age, income level or type and severity of disability are not taken into account when determining the value of the SSI benefit. In 2015, the maximum disability benefit for SSI recipients is $733 for an individual, or $1,100 if the recipient has an eligible spouse.
SSI is payable only to those who meet the SSA’s disability determination and who are considered low-income. The monthly benefit amount is decreased based on the applicant’s countable income. If the value of your countable income exceeds the maximum monthly benefit amount, you will be ineligible to receive SSI.
Countable income is looked at on a monthly basis, so it is possible for a recipient to be eligible for SSI in one month, only to become ineligible two months later because he has too much income for that month. The SSA considers the following to be countable income (this is not an exhaustive list):
- Wages or net earnings from self-employment;
- Social security benefits;
- Pension or other retirement benefits;
- Other disability payments;
- Unemployment benefits;
- Cash gifts
- Food or shelter you receive for free or less than fair market value, and;
- Income of your spouse (this is considered deemed income)
There is certain income that the SSA does not count when determining your monthly payment amount. This non-countable income includes (this is not an exhaustive list):
- First $20 of monthly income;
- First $65 of monthly earnings, and one-half of monthly earnings over $65;
- Food stamps;
- Payments made to a third-party on your behalf (such as medical bills);
- Income tax refunds;
- Grants or scholarships used for tuition, and;
- Interest and dividends earned on countable resources.
Before applying for SSDI or SSI it is advisable that you meet with an attorney who is experienced in social security disability law. An experienced attorney can help you determine the likely benefit amount you would receive under either program, and whether there is anything you can do to maximize your monthly disability benefits.
Learn more by contacting Neil H. Good online or call toll-free#(847) 577-4476 to schedule your free case evaluation.