You must report any lump sum of money that you recieve while you are on Disbaility. However, it may not affect your benefits. If you are eligible for SSD benefits (which are based on your work history and disability) your resources do not matter. If you are only eligible for SSI benefits (which are based on your income and disability), this will affect your benefits because it is a needs-based program.
However, you must report it to the Social Security Administration.
Failure to do so may result in an overpayment - where Social Security will ask you to repay an amount back to them because you continued to collect benefits while you were not eligible to do so.
This answer contains general information only; and it is not intended as legal advice. It is not intended to and does not create an attorney client relationship. Information contained here is only a starting point and you should consider discussing your specific problem in depth with a licensed attorney.
For example, for Supplemental Security Income (SSI) those funds sitting in a bank account or another investment would be considered a resource (and if above $2000) make the individual ineligible for SSI benefits. One possible way to work around this is to place the funds into a special needs trust that restricts how the money may be spent - these are a bit tricky to set up so one needs a lawyer well-versed in special needs trusts to assist in establishing the trust.
Special Needs Trusts:
Disclaimer Information on this site is provided by Brian Scott Wayson as general information, not legal advice, and use of this information does not establish an attorney-client relationship. If you have questions about your specific situation, please call an attorney.
If you are getting SSI, you must report ALL money you get - lottery, inheritance, gifts, etc......
If you are getting SSDI, you are only required to report receipt of workers' compensation benefits, earnings, or other types of disability payments. Rather than face questions later on, though, it is always better to report everything, get a receipt showing you reported it, and keep the receipt.
The exact answers to questions like this require more information than presented. The answer(s) provided should be considered general information. The information provided by this is general advice, and is not legal advice. Viewing this information is not intended to create, and does not constitute, an attorney-client relationship. It is intended to educate the reader and a more definite answer should be based on a consultation with a lawyer. You should not take any action that might affect your claim without first seeking the professional opinion of an attorney. You should consult an attorney who can can ask all the appropriate questions and give legal advice based on the exact facts of your situation. The general information provided here does not create an attorney-client relationship.