Will my workers comp settlement affect my social security disability?

Asked over 2 years ago - Cuyahoga Falls, OH

My wcc was in Michigan. I have been receiving ssd with wcc offset. I just settled with language on a document stating monthly payments over a 27.83(?) year lifespan,however social security person looked at it strangely. I am in Ohio.The woman has me feeling very insecure and worried.How do I handle this if they revoke my ssd payments, I wont be able to live.Along with several other mistakes social security has made, I dont know how they will handle this.Are the laws different in Ohio? I was under Michigans workers comp laws at the time.

Attorney answers (4)

  1. Gerald Gregory Lutkenhaus

    Pro

    Contributor Level 18

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    Answered . In addition to above I would add it is common practice when settling a workers compensation claim to prorate the lump sum settlement over one's life expectancy. That way the prorated weekly amount is "very low" and if Social Security accepts this than the your future Social Security benefits are not offset vis a vie your workers compensation benefits.

    The applicable POMS ruling does say in computing the offset after a WC settlement SS is supposed to use the compensation rate as set forth in the final workers compensation settlement order approving the lump sum settlement. The POMS book is the book the Social Security office follows in dealing with lump sum WC settlements.

    Although this lifetime proration procedure has been accepted by SSA for some time, it is not uncommon for some SS clerks to be unfamiliar with it. You should request your WC attorney to write a letter to the SS office with a copy of the WC settlement order requesting the offset be stopped due to the life time proration.

    Of course, I am assuming the WC attorney did the proration correctly over your 27.83 year life expectancy.

    Good Luck!

    This response is meant to be information only and should not be considered to be legal advice. This information is... more
  2. Brian S Wayson

    Contributor Level 19

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    Answered . It may decrease or increase the offset. A lump sum Workers Compensation settlement affects Social Security depends on the nature of the settlement. Compensation for lost wages affects Social Security. Compensation awarded for future medical expenses or attorney fees does not affect Social Security.

    Social Security Disability Insurance and Workers Compensation combined cannot exceed 80 percent of pre-disability earnings. Social Security is reduced if combined benefits exceed the 80 percent cap. A lump sum award is prorated as if it were a weekly benefit. The reduction in Social Security continues until the offset is completed or until you reach full retirement age. Alternatively, you could end the offset by applying for reduced early retirement benefits instead of disability benefits.

    They will not 'revoke' your SSD, just offset it down to the 80% of your former salary maximum for combined WC and SSD. Sounds like your attorney knew about this and wrote the settlement well. Discuss it with her or him to get more specific insights based on the specific facts of your case.

    Disclaimer Information on this site is provided by Brian Scott Wayson as general information, not legal advice,... more
  3. Clifford Michael Farrell

    Contributor Level 19

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    Answered . My colleagues have all given good advice. If you do not have an attorney who handles both Social Security and workers' compensation issues, you need to find an attorney who is familiar with this issue. The language to include in a settelment is very brief, maybe 1 or 2 sentences. But if it is not done right, it can cost you thousands of dollars. The complexities of offset issues leave many attorneys who do not handle them regularly scratching their head. Ask questions and make sure you feel comfortable with their answer.

    From your question, I suspect you are okay...but it is not fully clear. Take the amount of the settlement you got after fees, and divide that settlement by 333 months (27.83 x 12 = 333 months). If you got $100,000 after attorney fees, that would be about $300 per month, and I would guess will have little or no impact on your benefits. But, it depends, so talk to an attorney who does lots of Social Security to see if they can answer your questions.

    I hope this information helps. Good luck to you!
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  4. Scott Michael Daniels

    Contributor Level 11

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    Answered . In addition to my colleague's very eloquent answer, I completely understand your concerns regarding the complexities of a potential workers' compensation offset. I want to point out that it is extremely crucial to review any kind of offset with your disability attorney, if you employed one, because the Social Security Administration makes a lot of mistakes when calculating a claimant's rate in light of a workers' compensation settlement. These mistakes can result in overpayments by Social Security that will cause frustration and confusion. To prevent an overpayment, make sure Social Security has the correct documentation of your workers' compensation settlement.

    Any information obtained from this answer should not be treated as legal advice and in no way creates the... more

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