How Are Social Security Disability (SSDI) Benefits Calculated in Pennsylvania?

Social Security Disability (SSD) provides two different types of programs for applicants.  If you have sufficient work credits after years of working and paying your FICA taxes, you should be able to apply through Social Security Disability Insurance (SSDI).  Otherwise, you would apply through the need-based Supplemental Security Income (SSI) program.  Your spouse and children may also be able to apply through SSDI using your record.  Since SSDI is based on your previous work history, it is no surprise that the amount of money you can receive in social security benefits is also dependent on your work history.  The Pennsylvania disability lawyers at Young, Marr, and Associates explain how SSDI benefits are calculated.

Calculating SSDI Benefits in Pennsylvania

Social Security Disability’s Social Security Disability Insurance system pays disability benefits based on your prior work history.  The Social Security Administration (SSA) starts by looking at your income.  Every paycheck you receive should have a portion of taxes taken out for “FICA,” which stands for the Federal Insurance Contributions Act.  These taxes are paid by an employee (and matched by their employer) to cover Social Security programs and Medicare.  The amount of income you’ve paid FICA taxes on is considered your “covered earnings,” and is put through calculations to determine your SSDI payments. These payments also depend on the SSDI income limits in Pennsylvania.

AIME Calculations

The SSA takes your long-term covered earnings to calculate your “average indexed monthly earnings” (AIME).  This takes your prior income and adjusts it against the national wage index.  This helps reflect changes in the standard of living over the years, as well as future changes that will come while you receive benefits.

PIA Calculations

The SSA takes your AIME amount and applies a series of formulae to find your “primary insurance amounts” (PIA).  The PIA is the base amount you receive in benefits, but it may be adjusted after calculation.  To find the PIA, the SSA applies your indexed earnings to a table of “bend points,” which are threshold values decided for each year, which change the formula.  For instance, applying for benefits in 2018, the SSA calculates your base benefits as the sum of:

  • 90% of the first $895 of your AIME, plus
  • 32% of any AIME from $895 through $5,397, plus
  • 15% of any AIME over $5,397.

In this calculation, $895 and $5,397 are the “bend points.”  For instance, if your AIME defines your average monthly wages as $5,000 when you become disabled in 2018, your benefits will be the sum of:

  • $805.50 (90% of your first $895), plus
  • $1,313.60 (32% of all wages from $895 to your total $5,000 AIME).

That means your base benefits start at $2,119.10.  The SSA rounds this value off at 10-cent intervals.  If the SSA comes up with a different value, you may be able to file for a disability hearing to appeal your benefit amount, even if your benefits are not denied in full.

Adjustments for Age and Maximum Benefits

After finding this base benefit number, the SSA may increase or reduce your benefits depending on whether you’ve reached your full retirement age or not.  Since these are disability benefits not retirement benefits, this seems strange, but it may still apply.  These benefits are also subject to a maximum amount of $2,788 per month for 2018.

Calculating Family Benefits for SSDI

In many cases, you may also receive benefits for your family.  Your spouse and children can also receive disability on their record.  Minor children, the parent of a child under 16, disabled spouses, and disabled children (disabled before they turned 22) can receive benefits on your SSDI record.  In many cases, the total benefits your family receives will be capped at 50% or 80%, depending on the circumstances.  Still, as a family unit, you may still receive a total of 150% or 180% of your benefit amount, since they can receive the reduced benefits in addition to your benefits.

Offsets for Other Disability Benefits

If you receive multiple disability benefits at the same time, Social Security Disability may be reduced.  SSD is designed to essentially be the last resort for disability, and its rules allow SSD payments to be reduced if you receive other benefits aside from SSD.  This means that if you receive workers’ compensation benefits or other long-term disability benefits, your SSDI payments may be “offset.”  There are plenty of issues to discuss regarding how to best coordinate your benefits to help you achieve the best support during your disability, which is something a disability attorney can help with.

Pennsylvania Social Security Lawyers Offering Free Consultations

If you or a loved one is suffering from a disability, talk to our disability lawyers today about what SSDI benefits you might be entitled to.  The disability lawyers at Young, Marr, and Associates offer free consultations on Social Security Disability cases.  If you are in Pennsylvania, call us today at (215) 701-6519, and in New Jersey, call (609) 755-3115.  Our attorneys are available to schedule a free consultation to discuss your disability benefits.