You pay approximately 7.5% of each dollar you earn to this tax. Your employer matches it. These taxes are sent to the government quarterly. They pay for the massive Social Security and Medicare programs.
What is this important to you? Because, if you haven't worked long enough and paid FICA long enough, you don't have any coverage for Social Security disability. In other words, you may become disabled but not be able to get any benefits because you haven't paid enough FICA tax into Social Security.
No money in, no money out.
Also, the amount of your monthly disability benefit is calculated by the amount of your wages and the amount of FICA tax you have paid over your working lifetime. The higher your wages, the more FICA tax you paid, the higher your benefit will be. In 2019, the average SSDI benefit is about $1,235 per month but the maximum is $2,861 for higher wage earners (non-blind).
We often run into problems when an individual hasn't worked enough, or recently enough to have SSDI coverage. For most people, they need to have worked about 5 years out of the most recent 10-year period to be covered for Social Security Disability Insurance (SSDI). In other words, SSDI coverage can expire if you stop working for a few years.
As a rule of thumb, if you haven't worked in about 5 years, your SSDI (disability) coverage has probably expired. Each worker has a Date Last Insured (DLI) which is the date his/her Social Security disability coverage expires. It is important that you think of SSDI as "insurance," because that's exactly what it is.
What happens when you don't pay your insurance premium? Your coverage expires. And you can't file a new claim on an expired policy.
So, there are two important considerations when trying to get a Social Security disability (SSDI) benefit:
1. Are you disabled according to Social Security's rules?
2. Have you worked enough, and recently enough, to be covered by SSDI? (At least 5 years out of the past 10)?
Finding out your Date Last Insured is simple. Call the local Social Security office and ask what your DLI is. The Huntsville, AL office number is 1-866-593-0663 (option 0).
What if your DLI is in the past and your SSDI coverage has expired? Can you still file a new claim? Maybe, but you will have to prove that your disability began before the DLI. And you can usually file only ONE disability claim after the DLI has expired, so you get one chance.
I use the illustration of my car insurance. Let's say my automobile insurance is with the XYZ Insurance Co. and I forgot to pay my premium. My insurance at XYZ expired on February 1, 2019. If I had an accident before February 1, 2019 it would be covered. But an accident occurring after February 1, 2019 would not be covered (expired policy). Social Security works much the same way.
One final footnote: There is a totally separate program called SSI. This stands for "Supplemental Security Income," which does not require any work or any FICA tax to be paid. SSI has no expiration date, since you don't pay into it. It does have income/resource restrictions to qualify. So, even if your SSDI coverage has expired, it may be possible to file for Supplemental Security Income or SSI, if your household income is low enough and you meet all the other requirements. This is also a question for your local Social Security office.
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THE FORSYTHE FIRM
7027 Old Madison Pike - Suite 108
Huntsville, AL 35806
CALL US (256) 799-0297
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