SSI/SSDI/CDB) ______Legal Disclaimer
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Today’s Presenter Alison M. Packard Alison is an attorney at THE PACKARD LAW FIRM in San Antonio, Texas. She focuses her practice on special needs planning, including trust and estate work, government benefits, guardianship, alternatives to guardianship, and general probate work. Alison is the mother of a 26-year-old daughter with significant special needs. The combination of Alison’s personal and professional experience allow her to better understand and serve her clients who worry about their loved ones with disabilities. 1 Social Security Disability (SSI/SSDI/CDB) ________________ Legal Disclaimer This presentation should not be construed as legal advice for any particular set of circumstances. Please visit with a licensed attorney to discuss your personal situation. Understanding Social Security Benefits SSA LANGUAGE SSI POMS ODAR SSDI DLI RFC RSDI AOD SVP DIB PIA ME DAC AIME VE CDB DRC ISM SVB DDS VTR COLA ALJ PMV Thousands of laws, regulations, policies and procedures • High staff turnover at SSA. • Disability cases not as common as other cases. SOCIAL SECURITY RETIREMENT Monthly payment (Average earnings over 35 highest-paid years) + Medicare Retirement Age ▪Age 62 = lower amount ▪FRA (age 67 if born after 1960) = full benefits ▪Age 70 = maximum amount www.ssa.gov/myaccount What happens to the benefit if the worker dies or becomes disabled before retirement age? (Title II) Social Security Disability Insurance • Disability Benefits • Survivor’s Benefits • Dependent’s Benefits • Childhood Disability Benefits Spouse Minor Child Disabled Adult (sometimes ex-spouse) Child Other “Insured” Beneficiaries Childhood Disability Benefits (CDB) ▪Over age 18 and not married ▪Disability began before age 22 (& continuous) ▪Parent has died, retired or become disabled Benefit: Up to 50% (living parent) Up to 75% (deceased parent) Easiest way to prove that disability existed before age 22? SSDI or SSI eligibility before 22 Applying for Disability Benefits 1. www.SocialSecurity.gov 2. (800) 772-1213 to create protected filing date 3. Local Social Security office 4. Attorney filing SOCIAL SECURITY DISABILITY INSURANCE (SSDI) Monthly payment (based on work history) + Medicare (after waiting period) (Title II) Social Security Disability 1. MEDICALLY determined to be disabled 2. TECHNICALLY eligible (work credits) Disability - Child Medically determinable physical or mental impairment; Impairment results in marked and severe functional limitations; Impairment has lasted or is expected to last at least one year or result in death. Medical Qualification for Child Six Domains 1. Acquiring and using information (report card) 2. Attending and completing tasks (report card) 3. Interacting/relating to others (disciplinary records) 4. Moving/manipulating objects (special education paperwork, doctors’ reports - “Are they meeting milestones?”) 5. Caring for self (special education paperwork) 6. Health and physical well-being (catch-all category – medical records) MARKED LIMITATIONS IN TWO DOMAINS or SEVERE LIMITATIONS IN ONE DOMAIN Disability - Adult Unable to engage in any substantial gainful activity by reason of medically determinable physical or mental impairment that is expected to result in death or last at least 12 months 2021 SGA $1,310/mo. - non-blind individual $2,190/mo. - statutorily blind individual 5-Step Evaluation 1. Is claimant working? 2. Is medical condition severe? 3. Does medical condition meet or medically equal a listing? 4. Can claimant do previous work? 5. Can claimant do other work? Medical Listing SSA Blue Book Example: Intellectual Disorder (Listing 12.05) 1. Subaverage IQ 2. Deficits in adaptive functioning 3. Manifested before age 22 Subaverage general intellectual functioning • FS IQ score 70 or below; or • FS IQ score 71-75 accompanied by verbal or performance IQ score 70 or below; and • Extreme limitation of one, or marked limitation of two, of following areas: • Understand, remember, or apply information • Interact with others • Concentrate, persist, or maintain pace • Adapt or manage oneself SSA “Blue Book” Listing for NON-MOSAIC DOWN SYNDROME 1. Copy of the laboratory report of karyotype analysis, which is the definitive test to establish non-mosaic Down syndrome; or 2. Physician’s report stating: (i) karyotype diagnosis or evidence that documents this type of Down syndrome is consistent with prior karyotype analysis (for example, reference to a diagnosis of “trisomy 21”), and (ii) patient has the distinctive facial or other physical features of Down syndrome. 5-Step Sequential Evaluation Process 1. Is claimant working? No 2. Is medical condition severe? Yes 3. Does medical condition meet or medically equal a listing? No 4. Can claimant do previous work? No 5. Can claimant do other work? Vocational Expert • Specific Vocational Preparation (SVP) number • Various Hypotheticals • Job Opportunities SSDI 1. MEDICALLY determined to be disabled 2. TECHNICALLY eligible (work credits) Technical Denial “You do not qualify for disability benefits because you have not worked long enough under Social Security.” Disability prevented work Not enough work credits? Stay-at-home parents No participation in the Social Security system SUPPLEMENTAL SECURITY INCOME (SSI) Monthly payment + Medicaid 2021 FBR: $794/mo. individual; $1,191/mo. eligible couple. (Title XVI) Supplemental Security Income 1. MEDICALLY disabled (same criteria as SSDI) 2. TECHNICALLY eligible (financial) SSI Technical Eligibility “Needs-based” Limited income and program to provide assets to qualify basic food and shelter benefits (“Means-tested”) 4 Types of SSI Income Earned income Unearned income In-kind Support and Deemed income Maintenance (ISM) Deemed Income • Spouse’s income counts for other spouse. • Parent’s income counts for child under age 18 (if parent is living in home). ISM Income In-kind Support and Maintenance (“ISM”) is food or shelter that somebody else provides for you. General Rule: If you live in another person’s household for free, your SSI is reduced by one-third of the maximum federal benefit rate. SSI Unearned Income • Unearned Income = dollar for dollar deduction. • Other than the first “$20 disregard,” all income counts unless it is on the specifically excluded list • Gifts, child support, SSDI, pensions, military survivor benefits and IRA payments are unearned income. SSI Unearned Income Example: $500 gift 1. Disregard first $20. 2. SSI reduced by remaining balance of $480 $794 - $480 = $314 SSI Earned Income First $65 of monthly earned income = no deduction SSI benefits reduced $1 for every $2 earned over $65 (½ of earnings) SSI Earned Income Example: $485 monthly wages 1. If no unearned income, disregard first $20. 2. Don’t count next $65. 3. Deduct half of remaining $400 ($200) from SSI payment $794 - $200 = $594 $594 SSI payment + $485 wages= $1079 total income Student Earned Income Exclusion Individual under age 22 and regularly attending school: • Up to $1,900 monthly exclusion and $7,670 calendar year exclusion (2020) IMPAIRMENT–RELATED WORK EXPENSES SSA may exclude out-of-pocket expenses for items and services related to disability and needed in order to work. PLAN TO ACHIEVE SELF–SUPPORT (PASS) SSA does not count income or resources set aside under approved PASS when figuring SSI benefit amount. Resource = anything that can be converted to cash, unless excluded by law. Limited Resources Under $2,000 ($3,000/couple) (Assets) • Measured 1st day of month. • Spouse’s resources count. • Parents’ resources count for minor child (not adult child). Resource Exclusions • First $2,000 ($3,000 if married couple) • Home of any value • Car of any value • Household goods and personal effects • Life insurance with face value less than $1,500 • Pre-paid funeral or burial plot • Burial fund worth up to $1,500 • Retroactive SSI or SSDI payments for 9 months • Special Needs Trust • ABLE Account How is a Special Needs Trust different from another trust? • Beneficiary is disabled (physically or mentally). • Beneficiary control is restricted. • Stated purpose to “supplement and not supplant” government benefits – NOT a support trust. • Trust is not a countable resource. First-Party SNT: Funded with assets that belong to beneficiary Two Types (Medicaid payback) of SNTs Third-Party SNT: Funded with assets belonging to anyone other than the beneficiary (No Medicaid payback) Excess Income or Resources? Personal injury settlement Inheritance already received Bank account/investment account Child Support Military Survivor Benefits • Ineligibility, reduction or loss of “means-tested” government benefits CHILD SUPPORT Lifetime child support (if allowed by state law) can be irrevocably assigned to first-party SNT. This must be done by court order. An agreement to this effect will not work. MILITARY SURVIVOR BENEFITS Disabled Military Child Protection Act (Dec. 2014) Inheritance from Grandma • Special Needs Trust THIRD-PARTY SPECIAL NEEDS TRUST Created & funded by any third party (someone other than beneficiary) NO MEDICAID PAYBACK SNT Benefits • Assistance with money management • Protection against financial abuse • Eligibility for needs-based government programs • Supplemental funds to enhance quality of life • May avoid Guardianship of Estate Estate Planning is Critical for Families with Special Needs Child • Update Will to have property gifted to special needs trust. • Change designated beneficiaries on bank accounts, retirement accounts, life insurance policies, etc. ABLE ACCOUNT The Stephen J. Beck, Jr. Achieving a Better Life Experience Act of 2014