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Does workers' comp and other payments affect SSDI?

Recipients of Social Security disability benefits for injury may also be eligible for New Jersey workers' compensation or other public disability benefits for any injuries that they suffered. However, these programs could reduce an individual's Social Security disability benefits.

State or federal workers' compensation benefits are paid to a person who suffers a work-related injury or illness from government bodies. Private insurance companies may also pay these benefits the behalf of employers. Other public benefits are also paid for disabling conditions that are not job-related. These include civil service disability payments, state temporary disability benefits and other state or local government retirement benefits for a disability.

The total of these workers' compensation or other public benefits to recipients or their families plus SSD benefits cannot exceed 80 percent of a recipient's average current earnings before the disability was incurred. When this occurs, the excess amount is deducted from the Social Security disability benefit payments. This reduction continues until the recipient reaches full retirement age or the month the other benefits end, whichever occurs first.

However, other disability benefits may not reduce one's SSD benefits. For example, private disability benefits from private pensions or insurance benefits do not affect SSD benefits. SSD benefits are not reduced if these payments are received with Veterans Administration benefits or Supplemental Security Income. Additionally, state and local government benefits do not reduce SSD benefits if Social Security taxes were deducted from a recipient's earnings.

The Social Security Administration uses various formulas for calculating average current earnings. Lump sum workers' compensation or other disability payments may also impact the amount of SSD benefits. Any changes in the payment amount of other disability benefits, or their cessation, could also change the amount of SSD that was awarded.

Applying for SSD and receiving its full benefits may be complicated. An attorney may assist applicants with seeking benefits and assuring that they comply with federal regulations. A lawyer can also aid with an appeal of any denied claim.

Source: Social Security Administration, "How workers' compensation and other disability payments may affect your benefits," Accessed March 26, 2017

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