Social Security Disability Insurance (SSDI) is a payroll tax-funded, federal insurance program whose purpose is to provide income to people unable to work because of a mental or physical disability. It is administered by the Social Security Administration and provides financial compensation in the form of monthly benefits. There are strict requirements on who is and is not eligible for these benefits, and there are some wage limits that you should be aware of.
SSDI Wage Limits
The Federal law definition of disability is very exact. It must be a disability that will last at least one year and/or result in death. While some government programs provide benefits to people with partial or short-term disability, SSDI does not. According to the Department of Employment, Training and Rehabilitation (DETR), there is no limit to how much you may collect. You will continue to receive monthly benefits as long as your condition prevents you from being able to work.
Your case will be reviewed periodically to see if there has been any improvement in your condition and whether you are still eligible for benefits. If you are still eligible when you reach the age of 65, your disability benefits will be automatically converted to Social Security retirement benefits. If you are totally disabled from all forms of employment, it is possible for you to receive wage-loss benefits for the rest of your life.
Calculating Social Security Disability Benefits
Calculating your SSDI benefits starts with a look at the four thirteen-week periods prior to your date of injury. The calculation is based on salary and any other income you received. If you have a second job, those wages are also included in the calculation. Your average weekly wage is determined by averaging your wages during the three highest thirteen-week periods. If you worked seasonal or part-time jobs, the calculation will be a little different.
Once you qualify for SSDI, you are entitled to receive approximately two-thirds of average weekly earnings prior to your injury. There is a maximum limit on this but that increases every year. Annual “indexing” adjustments are made to compensate for cost-of-living modifications or increases. If you are also receiving Workers’ Compensation benefits, your SSDI benefit amount may be reduced by a certain percentage.