How much will my Social Security disability benefits pay?
These days, life is expensive. This is even more true for people who are or who will be on a fixed income. Frequently, clients want to know how much they will receive if and when their disability benefits are approved. The answer depends on many factors, the first of which is what type of benefit or benefits they will receive.
The maximum Supplemental Security Income that a person can receive is $994 per month for 2026. Each year, this figure, called the “Federal Benefits Rate” or “FBR” increases by the Cost of Living Adjustment (COLA) that the Social Security Administration applies. SSI is a means-tested benefit. This means that one must have low income and few financial assets, called “resources, to receive the benefit as well as being a senior citizen aged 65 or over or a person with a disability that meets the Social Security Administrations definition. Any income the recipient does have in addition to the SSI will reduce her/his SSI payable. Unearned income reduces SSI payable dollar for dollar after the first $20. Earned income reduces SSI payable by $1 for every $2 earned after the first $65. If a person does not pay for her/his shelter, the value of the shelter is considered “In-kind Support and Maintenance” or “ISM” and reduces SSI payable by 1/3 of the FBR. The reductions for unearned income, ISM and earned income all factor in to how much SSI an adult with a disability can receive. An adult is anyone over the age of 18. Children may also be eligible for SSI based on disability, but in the case of children, there is a complex formula that takes into account how much income the parents have as well as the number of persons in the household. Therefore, the amount of SSI that any one person will receive depends on their other income and their living situation.
The amount of Social Security Disability Insurance (SSDI) that a person can receive depends on her/his past history of working in “covered” jobs where s/he paid Social Security tax, often called FICA or OASDI. To calculate a recipient’s SSDI, the SSA first calculates her/his Average Indexed Monthly Earnings or AIME, using annual indexing factors to recalculate past year’s earnings into “today’s” dollars. This accounts for the time value of money since a dollar had more earning power in the past. Then, the SSA applies a second set of calculations to the AIME to come up with the person’s Primary Insurance Amount or “PIA.” This formula applies different percentages to different portions of the person’s AIME as follows:
90% of the first $1,286 of the AIME plus
32% of the AIME over $1,268 and up to $7,749 plus
15% of the AIME over $7,749
So, how much SSDI a person can receive depends on their earnings history. For young people with intellectual and developmental disabilities who do not have a long work history and whose monthly earned income at the time of application is below the Substantial Gainful Activity or SGA level, which is $1,690 per month in 20206, the PIA is very close to the AIME. For older individuals, whose disability onset later, there may be considerable difference between the AIME and the PIA. It is worth noting that SSDI is considered “unearned income” in the SSI calculation. Despite this offset, if the person’s earned income and SSDI are low enough, s/he may continue to qualify for SSDI.
People whose disabilities started prior to their age 22 and who continue to meet the SSA’s definition of “disabled” until a parent files for Social Security Disabilty or Social Security Retirement or dies may be able to receive a Disabled Adult Child (DAC) benefit, also called a Childhood Disability Benefit (CDB). This benefit is an amount up to 50% of the PIA of the parent who files or, if both parents file, 50% of the PIA of the higher wage earning parent. Here, too, there is no one clear answer because if more than one auxiliary, for example a spouse or a second child, also claim on that same parent’s social Security number, the amount paid will be less than 50% due to the Family Maximum, which limits how much can be paid out on a single Social Security number. In the event that the person who is eligible for CDB/DAC is also eligible for SSDI on her/his own work record, then s/he receive their SSDI plus a partial CDB/DAC such that the total equals the CDB/DAC amount they would have received if there was not SSDI in play.
Comments