If you are on disability and receive benefits, one of the things you might want to know about is how workers' compensation and other disability payments can affect your Social Security benefits. Fortunately, disability payments that come from private pensions or insurance companies don't affect your Social Security Disability benefits, so you will see no changes in the payout you receive.
Will receiving public disability benefits affect you if you receive Social Security Disability benefits?
Public disability benefits and workers' compensation benefits may both decrease your overall Social Security benefits, however. Any payments that come from a federal, state or local government can affect your Social Security Disability. If you do receive workers' compensation and other public disability benefits alongside Social Security Disability benefits, you're limited to receiving 80 percent of your average wage from before you were disabled. Why the discrepancy? In most cases, you can still work a small amount to make up the difference without affecting your disability benefits, depending on what you want to do.
Are there any exceptions to the rule about public funds affecting disability payment rates?
There are a few exceptions to this rule about public benefits. Social Security Disability benefits are not affected by Veterans Administration benefits or state or local government benefits if you had Social Security taxes taken out of your earnings. Supplemental Security Income also does not affect the amount you can receive from Social Security Disability.
Your attorney can help you understand how your disability benefits will be affected before you accept further compensation if it's a consideration in your case. The right choices now can make a difference to your finances.
Source: Social Security Administration, "How Workers’ Compensation And Other Disability Payments May Affect Your Benefits," accessed Feb. 03, 2017