When you receive workman’s compensation, (work comp) there will be some issues you may need to know about if you also intend to receive Social Security Disability. Under the rules that govern disability there is a provision known as the offset provision. Below I will explain what you can expect, and how seeking advice of a licensed attorney could save you money. There are solutions to the offset problem.
The Receiving of Workman’s Compensation Benefits on a Monthly Basis Example:
This is how the offset provision affects your pay from Social Security Disability, when you receive workman’s compensation on a monthly basis. It works like this, lets say you receive $2,600.00 a month from work comp, that is your monthly compensation rate. We further look to your Social Security draw per month, (this can be found on the paperwork they send you, every year around your birthday), lets say your draw is $1,000.00 per month. We now take your monthly work comp rate of $2,600.00 a month, then we add your Social Security draw of $1,000.00 per month for a total of $3,600.00 per month, that is your income under Social Security rules. Then lets say you start to draw Social Security Disability, before they start to pay you, they look to what is 80% percent of your best years salary in the last 5 years before disability date, lets say it is $3,500.00 a month, ($42,000.00 a year divided by 12 months) so now lets say 80% of that would be $2,800.00 a month, that is your income limit for Social Security. So in conclusion you would be over your limit in this scenario by $800.00 a month, and this is the amount they would withold from your $1,000.00 a month Social Security Disability check.
The Receiving of Workman’s Compensation Lump Sum Payment Example:
Just because you received a lump sum work comp payment does not mean there will be no offset, Social Security prorates out the money from work comp lump sum payments like this, you receive a lump sum of $40,000.00 dollars and your work comp rate is $400.00 a week, divide $40,000.00 by $400.00, this gives you 100 weeks, that is how long the offset will last.
There are solutions to this problem, it lies in the way the work comp is written in your settlement paperwork. Please contact the law office if you have questions concerning your disability. I look forward to speaking with you, my numbers are toll free (877) 271-2633 and local (615) 308-2633, available Monday through Friday.
Daniel L. McMurtry, Esq.