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How do workers' compensation benefits affect SSD benefits?

Many people in the Houston area who are receiving workers' compensation benefits may wonder if they can apply for Social Security disability benefits as well. This question is most commonly asked by people who have received a high disability rating on their workers' compensation claim and who may be facing a substantial reduction or elimination of future income.

First, the good news. Disability payments from private sources such as pension plans or disability insurers do not affect a person's right to apply for and receive Social Security disability benefits. However, if a person is receiving a public disability benefit, such as a workers' compensation payment, that person's SSD benefits may be affected.

The rule is easy to state: a person who is receiving both workers' compensation disability benefits and SSD benefits cannot receive more than 80% of the worker's average current earnings before the worker became disabled. Payments for matters such as medical expenses and rehabilitation are not affected. The calculation is performed as follows: the amounts received by the worker and his or her family members are added together. If the total of these amounts exceeds 80% of the worker's average current earnings, the excess will be deducted from the worker's Social Security disability payments.

Certain kinds of payments may complicate the calculation of the maximum monthly benefit. For example, a lump sum workers' compensation settlement may reduce the amount of SSD benefits one can receive. The Social Security Administration uses different formulas to calculate a person's current average income, depending upon place of residence and similar matters. Anyone who has questions about the effect of SSD benefits on workers' compensation benefits may wish to contact an attorney with experience in representing recipients of SSD benefits.

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