Past Earnings Play Role in Determining SSDI Benefits

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Applicants for Social Security Disability Insurance Should Know Their Income History; Allsup Answers Common Benefits Questions

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Knowing your earning history and keeping good records can be valuable when applying for SSDI

People who find themselves with a mental or physical disability face many hardships, not the least of which is the emotional struggle to accept that they no longer can work. While everything about a person’s life changes, the past still plays a role in the future, especially when it comes to Social Security Disability Insurance benefits, according to Allsup, which represents people nationwide for SSDI benefits.

The Social Security Administration uses past earnings—most importantly a record of those earnings—to determine how much an SSDI recipient receives each month.

“Knowing your earning history and keeping good records can be valuable when applying for SSDI,” said Paul Gada, a tax attorney and Allsup’s personal financial planning director. “It also pays to be informed about your benefit amount because you are facing a vastly different financial situation.”

Social Security Disability Insurance is a payroll tax-funded, federal insurance program. A portion of the FICA taxes that people pay is set aside for SSDI (as well as Social Security retirement and Medicare). SSDI, which was established in 1954, is designed to provide individuals with income if they are unable to work due to a disability or until their condition improves, and guarantees income if their condition does not improve.

Some of the most common questions SSDI applicants have relate to their benefits, so Allsup has provided the following insights on what to expect.

How much will I receive?
How much someone receives is determined by a complicated formula using the amount of their past earnings that have been subjected to FICA taxes.

The average monthly benefit for an individual was $1,004 in 2007. The maximum monthly benefit for an individual is about $2,000, and the maximum a family can receive is about $3,400 a month.

Allsup offers a Social Security benefits calculator online for individuals interested in getting their estimate right away. The formula involves entering all past earnings that are subject to FICA taxes. This information also is provided on an individual’s annual Social Security Statement. Click here to see a sample statement.

When will I receive my benefits?
The SSDI application process can be lengthy and complicated depending on an individual’s circumstances and disability. The time from initial application to award may last several months to as long as a couple of years, or longer.

For a majority of claimants, the time between being awarded SSDI and actually seeing a check is 60 to 90 days. In a small percentage of cases, Allsup has seen payments as quickly as one to two weeks from the time of notification. Typically, this is for simpler cases awarded at the initial application or first appeal in the SSDI claims process. One to three months is more typical for claims awarded at levels three and four. These time frames represent an average or general guideline – specific time frames may be shorter or longer.

Does my family receive anything?
Once someone qualifies for disability benefits, certain members of his or her family also may qualify for benefits on that person’s record. Benefits might be paid to a spouse or children. Each family member may be eligible for a monthly benefit of up to 50 percent of the individual’s disability rate. However, there is a limit to the total amount of money that can be paid to a family on an individual’s Social Security record. According to the SSA, the limit varies, but it is between 150 and 180 percent of an individual’s disability benefit.

Why would I want SSDI benefits?
Besides the regular monthly disability income, there are several additional benefits to receiving SSDI. These include medical benefits—24 months after the date of entitlement to SSDI benefits, an individual becomes eligible for Medicare; prescription drug coverage, which falls under Medicare; protected retirement benefits and benefits for dependents. Find out more by visiting the online section: Why You Want Social Security Disability Insurance.

How long can I receive SSDI?
An individual who is awarded SSDI benefits receives those benefits as long as he or she is disabled and cannot work. Keep in mind that SSDI benefits are awarded to people with disabilities expected to last for at least 12 months or result in death.

After benefits are awarded, a person’s eligibility is subject to review at certain intervals. These intervals are based on whether someone’s condition is expected to improve, and typically are at one, three, five or seven years from the time of award.

Allsup has been representing disability applicants for 24 years, and has helped tens of thousands of individuals get through the SSDI process. This expertise and focus on truly helping individuals and their families drives the company’s efforts to educate and help individuals who are going through this process.

More information on financial topics and SSDI benefits can be found online at

About Allsup
Allsup, Belleville, Ill., is a leading nationwide provider of financial and healthcare related services to people with disabilities. Founded in 1984, Allsup has helped more than 100,000 people receive their entitled Social Security Disability Insurance and Medicare benefits. Allsup employs more than 500 professionals who deliver services directly to consumers and their families, or through their employers and long-term disability insurance carriers.

For more information, visit

Rebecca Ray
(800) 854-1418, ext. 5065

Dan Allsup
(800) 854-1418, ext. 5760

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Rebecca Ray

Dan Allsup
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