How Are Disability Benefits Determined?

Any person who cannot work because of an illness or injury is eligible for Social Security benefits. But how does the administration determine the actual amount of benefits? The calculation of Social Security Benefits is done the same as the Social Security retirement benefits. Both figures are based on the person’s history of “covered earnings,” that is the amount of their income on which they paid Social Security taxes.

Let’s learn more about it in detail.

How Does SSA Figure the Benefits?

The Social Security Administration (SSA) begins the process by calculating your mean monthly income throughout your work life and adjusting it for your historical wage growth. They then plug that amount into a mathematical formula that determines the amount of your primary insurance (PIA); that’s also known as the full retirement benefit.

The PIA formula

The formula for PIA is progressive — it’s weighted so that it calculated relatively higher benefits to people with low income — and this formula is the same whether you’re availing your disability or retirement benefits. The only thing that differs is the amount of income used to determine one’s full amount of benefits.

For the retirees, the SSA only uses your 35 highest-earning years to determine your mean monthly income and plug this into the PIA. A person is eligible to claim the full amount at their retirement age. Your benefits can also reduce if you claim them earlier.

Calculating the Average Income

However, a person can become disabled well before reaching their retirement age. For this reason, a different timeline is used by the SSA to figure out the SSDI claims. Depending on the age a person becomes disabled, the years of income used in the formula may differ.

Here’s how SSA determines your number of earning years:

· The Social Security Administration counts years from the time the person turned 22 till the year they became disabled​.

· It drops between 1 and 5 years (the longer the person has been working, the more years they drop out)

· The final number is the number of years of the person’s highest income years that will go into PIA formula.

For example, if a person has been employed without a gap since they turned 21 but became disabled at the age of 60, SSA would use their 33 highest-paid income years to calculate their PIA. And if they became disabled at 50, for example, then their 23 highest-paid income years would be used. Whatever the age is, a person is awarded 100 percent of their PIA, given that their SSDI claim gets approved.

Hire a Social Security Disability Lawyer in Arkansas

Obtaining SSD benefits can be tricky given the legal jargon and the paperwork. That’s why it’s always better to hire a Social Security Disability lawyer. They can assist you with your appeal and boost your chances of receiving the benefits in time.

If you’re looking for a Social Security Disability lawyer in North Little Rock, AR, The Law Offices of Lisa Douglas can help you. Lisa is an experienced lawyer with years of experience and has helped many people successfully obtain their benefits.

She is also a personal injury lawyer. If you're interested in booking a consultation, call 501-798-0004 or visit the website.

 

 

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