My husband is permanently disabled due to having peritoneal mesothelioma, he receives a disability check each month and Medicare medical insurance. He is about to get a settlement, does he gave to report this settlement to social security? If we deposit this check in a bank account does the government have access to this bank account? Just worrying about losing his disability. Any advice would help.
Disability coverage from social security is not a means based benefit, so it should not be affected by his settlement. Confirm with his mesothelioma counsel who likely have much experience with this scenario.
If your husband receives social security disability a legal settlement can affect his monthly benefit amount, despite SSDI not being needs based.
This frequently happens with workers' compensation claims. Social Security Disability Insurance benefits can be reduced so that a beneficiary does not receive more than 80% of their previous average earnings when the disability rate and other benefits are combined. The purpose is to prevent a situation where it is financially more beneficial to not work than to work. It is my understanding that a mesothelioma settlement, much like a workers' compensation settlement, can reduce the disability rate. One way to avoid this in many instances is to draft the settlement as an allocation of funds over your husband's life expectancy rather than a single payment, even though it might be paid in one lump sum. For example; if your husband is 60 years old with a life expectancy of 21 more years, receiving a settlement of $50,000, you would draft it as $198.41 per month for 252 months. Only $198.41 per month will be factored into the 80% equation and most likely not affect the disability rate. Be sure to discuss this with the attorney handling the mesothelioma case.
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