Will the SSDI Program Go Bankrupt?

How Is SSDI Funded?

Social Security Disability Insurance covers disabled people who have been working for a substantial amount of time. Because SSDI is funded through the Social Security Trust Fund, taxpayers pay for it.

FICA Taxes & SSDI Funding

Employers pay FICA taxes. This trust fund is used to distribute benefits. If you work for yourself, both you and your employer pay the tax. This way, you can contribute to an entitlement that can help if you currently have a disability.

It doesn’t matter your household income, so you can still be eligible for SSDI even if your spouse is employed. However, there are still some conditions.

To be eligible for SSDI, you must have worked long enough and have paid a certain amount through FICA taxes to Social Security. This is calculated by the Social Security Administration using work credit.

SSDI and Work Credits

Earnings are converted to work credits. Each year, the amount required to earn one credit for work is recalculated. One Social Security work credit equals $1,260 in earnings in 2016. If you make $5,040 in wages over a year, you can earn up to 4 work credits.

Credit for Social Security Disability is available to anyone. The length of your work experience is more important than the amount you have paid. Your eligibility for disability is determined by how many years you have worked. The rules for different ages are different. To be eligible for benefits, you will need to have more work credits if you’re older. This means that you have worked for a longer time.You will need to pass two tests involving work credit: the Recent Work test and the Duration test.

Will SSDI Go Bankrupt?

Because SSDI applications have decreased since 2010, the Disability Insurance Trust Fund is in a decent position. This reduction in applications helps to ensure that it pays disability benefits. Also, the number of beneficiaries who are disabled workers has declined. Accordingly, the fund will run out of money in 2057, eight years sooner than the 2020 estimate. This updated forecast will mean that only 91% of benefits will be paid around 2057, but it will not be bankrupt.

Are You Worried About SSDI Going Bankrupt?

There are two significant problems with social security disability insurance that could affect you. One is funding, which is starting to run out sooner than expected due to increased claims over the past decade. The second issue is fraud, where people who don’t qualify for SSDI get benefits anyway fraudulently. This costs taxpayers billions each year and harms those truly disabled by delaying their benefits or leaving them without any help at all. This does not mean SSDI is heading for bankruptcy.

Contact us right away to schedule a consultation with one of our social security lawyers.

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