You may be eligible for Social Security Disability Insurance (SSDI) benefits if you have a condition that keeps you from working. If you cannot work due to a disability, you might not have the means to wait for the Social Security Administration (SSA) to accept your claim and begin giving you benefits. From the time you apply until you start receiving benefits, a lot of months may have passed. If you find yourself in such a situation, you might be wondering whether SSDI benefits can be applied for in the past, or, in other words, paid retroactively.
SSDI benefits may be retroactive. If you meet the requirements, you may receive retroactive SSDI payments for a period that extends back up to 12 months from the date of your application. To ensure you receive all your benefits, applying for retroactive payments when submitting your application is crucial.
This article will examine the guidelines for retroactive SSDI payments and what you should know.
Everything About SSDI Retroactive Payments
Retroactive SSDI benefits are typically payable after a 5-month waiting period from the date of disability onset.
Retroactive Supplemental Security Income (SSI) benefits may be paid from the month after the Protective Filing Date (PFD), and Retroactive SSDI benefits may be paid from the established date of onset of disability plus the 5-month waiting period. Count the months between your EOD and application date to determine the number of retroactive months.
These payments may offer much-needed financial assistance for people whose SSDI applications were delayed.
Who Is Entitled to Receive Retroactive Payment?
The SSA offers payments through two programs: Supplemental Security Income and Social Security Disability Insurance. SSI participants are eligible for benefits based on income and needs.
A certified disability that has or will keep them from working for at least a year is a requirement for SSDI beneficiaries.
Disability back pay is paid to SSDI and SSI recipients who meet the requirements. The period between when you initially submitted your application and the period the SSA approved your benefits is covered by your back pay. Back payments might be significant because this process can frequently take months.
Retroactive pay differs from back pay because it offers compensation for the months between the time of your onset disability date and when you requested benefits.
Retroactive SSDI and SSI Payments
There are two distinct SSA benefit programs available: Supplemental Security Income and Social Security Disability Insurance. They differ in eligibility criteria and how back and retroactive pay work:
- SSI benefits do not have a 5-month waiting period, meaning they start the month after approval.
- SSI benefits are not eligible for retroactive pay.
If you’re unsure which benefits to apply for, consulting a disability advocate can provide guidance on your eligibility for these programs. They can help you determine which benefits align with your circumstances and needs.
When applicants are granted SSI, SSDI, or both, they may qualify for retroactive or back pay benefits. The month following the Protective Filing Date is when SSI payments can start to be paid out, and after the 5-month waiting period, retroactive SSDI benefits will start to be paid out.
However, there are certain exceptions.
Retroactive SSDI Benefits
Retroactive SSDI benefits are those issued more than a month after the calendar month for which they are due. For example, SSDI benefits for January that are issued in February are not retroactive, but SSDI benefits for January that are issued in March are retroactive.
An SSDI beneficiary often receives retroactive benefits as a single lump sum payment.
There are no resource restrictions for SSDI retroactive benefits; therefore, if the SSDI recipient just receives SSDI benefits and not SSI, retroactive payments will not impair continued SSDI eligibility.
Retroactive SSI Benefits
SSI does not award any retroactive payments.
SSI benefits, which include any federally administered state supplementation, are issued in any month after the calendar month for which they are due.
Spending Down SSI Benefits
For SSI, you are only entitled to benefits beginning the month after you apply for them. For this reason, you will not receive retroactive benefits prior to the date you file.
Spending retroactive SSI, or benefits, on exempt resources is the best practice for SSI recipients to retain current SSI eligibility. Exempt resources are those that the SSA excludes from its calculation of SSI eligibility. Some examples include the following:
Home expenses which include purchasing a home, paying off a mortgage on an existing home, making adaptations to a property to accommodate a person with a disability, performing repairs or remodeling, and purchasing furniture or equipment for the home.
Health-related costs would include dental, eyeglass, physical therapy, and any medical bills or expenses that are not covered by Medicaid or Medicare, for example, purchasing a piece of higher-quality assistive equipment.
Personal expenses would include education, entertainment and recreation, vacation travel, debt repayment, prepaying funeral costs, purchasing personal care products, buying a car, covering registration and insurance, and clothing.
Compensation Available For Retroactive Pay
Although back pay and retroactive pay may appear similar, they have distinct differences. However, not everyone qualifies for SSDI retroactive pay. This is because retroactive pay covers the money you were entitled to receive before you applied.
For any reason, if you didn’t apply for SSDI right away, retroactive pay compensates you for up to one year before your application date if you were eligible for SSDI benefits during that time.
It’s determined by the monthly payments you were supposed to receive before you applied.
If the SSA finds that you were entitled to receive SSDI benefits before you applied, they will change your EOD (Established Onset Date) to an earlier date. Nevertheless, the SSA restricts retroactive payments to a maximum of 12 months. It’s important to remember that the 5-month waiting period applies. So, for you to get the full 12 months of retroactive pay, your EOD must be at least 17 months before your application date (17 months minus the 5-month waiting period equals 12 months of retroactive pay).
Consider the following scenario: Your EOD was June 1, 2021, and the SSA authorized your benefits 10 months later, on May 1, 2022. Then, you would apply the formula shown below:
Five months of retroactive payments equal 10 (total months from your EOD and approval) minus 5 (required delay)
Even if your EOD is adjusted to a period beyond 17 months, such as two years, you’re still limited to a maximum of 12 months for retroactive pay.
In such a scenario, you’d calculate your retroactive pay based on the same 17-month window. Therefore, you would still receive only 12 months worth of retroactive pay. However, if your EOD falls below the 17-month mark, you’d determine the owed amount by subtracting the 5-month waiting period from the number of months before your application date.
For example, if the SSA establishes an 8-month EOD, you’d calculate it as 8 months minus the 5-month waiting period, resulting in 3 months of retroactive pay.
Regular Monthly Disability Payments
Depending on the disability program you are eligible for, your back payments and regular monthly benefit payments will vary. According to the SSA, SSI benefits for 2022 were $841 for each individual and $1,261 for each couple. The SSA determines payment levels using the consumer price index and annual cost-of-living adjustments (COLA).
Based on employment credits and Social Security contributions, SSDI payouts will vary from person to person. According to the SSA, the average salary for all disabled workers in 2019 was $1,234.
SSI and SSDI benefit recipients are not permitted to earn more than the SSA’s Substantial Gainful Activity (SGA) threshold. The SGA amount for persons with disabilities other than blindness is $1,470 per month in 2023. For people who are blind, the amount of earnings that indicate SGA is $2,460 per month in 2023.
You probably will not be eligible for SSD benefits if your monthly income exceeds this limit.
Using SSDI Lawyers To Help You Obtain Benefits
The SSDI application process is challenging. As per the SSA, around 70% of first applications are turned down.
An SSDI attorney may help you with an appeal if the SSA rejects your claim for benefits. After receiving notice of the SSA’s decision, you have 60 days to initiate the appeal process. A new application may need to be submitted, adding to your stress, and causing payment delays, so be sure to start as soon as possible.
Application Procedure and Retroactive Payments
It’s important to remember that retroactive payments are not provided automatically and must be requested in writing. Remember to specify that when submitting your application.
When you become disabled and are unable to work, it is advised that you file for SSDI benefits as soon as possible. The SSA may take many months to decide on your case after a drawn-out application process. By submitting your application as soon as possible, you improve your chances of getting benefits approved as soon as possible for the months you are unable to work.
Effective Filing Date
The effective filing date heavily influences the ability to qualify for retroactive payments. The SSA usually gets your application on the effective filing date. There are a few exceptions to this rule, though.
The SSA may set an earlier effective filing date if you can show that you were incapacitated and unable to work before your application date. It is referred to as the protective filing date.
The protected filing date may be set up to 17 months before the application’s filing date. If your protective filing date is recognized, you may be entitled to retroactive compensation for the time between that date and the application’s actual filing date.
Factors Affecting Retroactive Payments
The sum of any potential retroactive compensation is subject to several variables. The most important element is your EOD or determined commencement date. The SSA determines that your disability began on the EOD.
The EOD determines when your impairment started and how long you might be eligible for retroactive benefits.
The date of your application is another aspect that may impact retroactive payments. You may receive fewer payments for months if you wait to file for SSDI benefits.
Offset and Retroactive Payments
It is important to note that retroactive SSDI benefits could be considered offset. Offsets are provisions in your disability coverage that allow your insurer to deduct from your regular benefit other types of income you receive or are eligible to receive from other sources due to your disability.
For instance, if you have been getting private disability insurance or workers’ compensation benefits throughout the retroactive period, the SSA may deduct that sum from your retroactive SSDI payments. It ensures that your total benefit package does not exceed the legal limit.
Retroactive Payments vs. Back Payments: Similarities and Differences
Back payments and retroactive benefits are meant to help people who cannot continue to work because of a disability. These payments aid in making up for the duration of the disability and for the period of time you did not receive benefits while the SSDI application was being processed.
Retroactive benefits extend further back in time compared to regular back pay, and they can be awarded in addition to it. These benefits are intended to compensate an individual for the period during which they were unable to receive assistance, going all the way back to the initial onset date of their disability.
In other words, back payments cover the time between the determined onset date of disability and the application’s approval; retroactive payments encompass the months before the application date.
Additionally, the individual’s earnings history and the amount of SSDI benefits they are qualified to receive are taken into account when calculating both retroactive benefits and back payments. Based on the individual’s average lifetime earnings and the date when their disability first started, the SSA utilizes a specific formula to determine the benefit amount.
It’s important to remember that both back payments and retroactive payments are subject to a number of restrictions.
Individual SSDI payments can offer much-needed financial assistance to people who are unable to work as a result of a disability.
You must satisfy the requirements established by the SSA and ask for retroactive benefits when submitting your application for SSDI benefits.
Applying for SSDI benefits as soon as you are unable to work due to a disability will increase your chances of receiving benefits. Keep in mind that if you earned additional disability benefits during the retroactive period, your retroactive payments may be offset.
A disability lawyer or advocate can walk you through the process and make sure you get the benefits you are entitled to if you need assistance with your SSDI application. Additionally, you can also visit the SSA’s official website for further help.
