It will absolutely affect your Social Security benefits, and the only relevant question is how much. A tightly drafted settlement agreement can lower the financial impact to zero or close, and a poorly drafted agreement can significantly affect your SS benefit income for a year or more.
You should definitely consult with an Attorney familiar with both Social Security and WC to minimize the impact. The settlement will potentially skew your income and cut your benefits if you exceed the income threshold.
If you use your Medicare coverage for your WC injury, that will open an entirely new can of worms, so avoid that unless you are in a REAL medical bind.
Medicare's interests must be protected in your workers compensation settlement with a Medicare Set Aside future medical account if you are applying for SS Disability or applying for Social Security retirement benefits. Where your future medical rights are specifically left open in the workers compensation case in settlement terms, this is not necessary.
Where, as a result of the injury, you actually qualify for Social Security Disability benefits, Social Security will take a credit or a deduction or an offset in their monthly disability benefit amounts to the extent of the workers compensation benefits received in settlement.
You must be very careful in the wording of your settlement or all SSD benefits can be denied until Social Security completely exhausts or uses up their credit for your lump sum workers comp settlement.
It is extremely important that you seek the advice of an experienced workers comp attorney or Social Security lawyer in your area before you finalize your settlement to take advantage of the allowed settlement language to maximize the combination of your workers comp benefits coordinated with receipt of your Social Security disability benefits.
Social Security can and will allow payment of combined disability benefits up to 80% of your former monthly income subject to a rather low maximum monthly benefit. The general rule is that the combination of benefits between your Social Security disability and Workers Compensation benefits cannot exceed 80% of your former monthly income.
See the Workers Compensation and Social Security Offset in the Soc. Sec. Act, Section 224(a) , 20 CFR § 404.408 ( https://secure.ssa.gov/apps10/poms.nsf/lnx/0452101001!opendocument )
See the SS Handbook ( http://www.ssa.gov/OP_Home/handbook/handbook.05/handbook-0504.html )
There is no similar worry of offsets or credits for workers comp settlements if you are qualified for and receiving regular SS "retirement" benefits rather than "disability" benefits There is no similar deduction from regular SS retirement benefits for the workers compensation settlements.
For your possible "Calpers" pension you are really going to need to consult with a lawyer to review the specific pension plan provisions and any offsets or credit language. We are not familiar with those specific terms or plan conditions.
Please be sure to seek out legal counsel in your area for a full explanation and complete understanding.
We cannot provide specific legal advice without a detailed review and representation. Only general advice and direction can be provided. No client relationship exists without a written representation agreement or retainer. Please seek out the advice of experienced counsel in your local area.
While I agree with the general tenor of my esteemed colleague's answer regarding the interaction between Social Security benefits and Worker's Compensation (WC) benefits, I am not sure the concerns around that issue apply in this situation.
From the original question post it is not clear which Social Security benefits the poster is receiving, as the poster stated they are not Social Security disability (SSD) benefits.
While it is true that the Social Security Administration (SSA) will make a determination about the need to offset SSD benefits versus WC benefits (essentially the combined monthly total of the two cannot exceed 80% of the individual's ACE score (basically the average monthly earnings based on the previous five years of work) the SSD benefits would be reduced until the monthly total was equal to 80% of the ACE - this is why the wording of the WC settlement is so important.) But here, the poster specifically said that the SSA benefits are NOT SSD. see: http://ssa.gov/pubs/10018.html
If the SSA benefits are SSI, which seems unlikely since they are resource based benefits and the poster likely has resources, then any WC benefits will reduce the SSI.
If the SSA benefits are some other non-disability based benefits, then the receipt of WC may not be offset as California does not offset its WC for SSA retirement benefits.
Also, if there is a potential offset between the SSA benefits and WC benefits then the type of each benefit will be a big factor in how much and which, if any, is offset. see: https://secure.ssa.gov/poms.nsf/lnx/0452120030
In summation, tell your WC attorney to be on top of it and avoid falling into a malpractice trap.
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