While the majority of Americans used to work for outside employers, many of today's Americans are pursuing their own passions and dreams and are now self-employed. When a self-employed individual becomes disabled, he or she may be confused as to whether or not they can qualify for Social Security Disability benefits and, if they do qualify, how much they will qualify for. If you are self-employed and have suffered from a long-term or permanent disability, you may be wondering if you can qualify for Social Security Disability payments. The following information can help you understand your rights to get disability and how your self-employment history may affect your eligibility.
Did You Report Your Income?
Many people assume that self-employed individuals are not covered by disability benefits. While this may be true for some individuals, it is definitely not the case for every self-employed person. A person's self-employment status is not what qualifies or disqualifies them for Social Security Disability benefits. It is how and if that person reported their income that will be a deciding factor. If you reported your income each and every year and paid taxes as you should have, then you will have been given work credits and you should be covered under the Social Security Disability program. If you did not report your income, work credits will not have been earned and this could pose a potential problem.
If you did not pay taxes and did not report your income, you may not be eligible for Social Security Disability benefits under the Social Security Disability Insurance program (SSDI) but you may still be able to qualify for Supplemental Security Income (SSI) if your household income and assets are below the qualifying limits. SSI is a needs-based program, however, and you must have very limited income and less than $2,000 in assets to qualify for SSI benefits.
Earning Work Credits For Social Security Disability Through Self Employment
To qualify for Social Security Disability benefits under the SSDI program, you must have earned enough work credits during your work history. The amount of work credits needed to qualify for Social Security Disability benefits will vary depending on your age and your work history. In order to earn work credits you must have reported your earnings on the federal tax returns that you filed each year. If you did not file tax returns or did not report earnings (or did not report enough earnings) you may not have enough work credits to qualify for Social Security Disability benefits.
Employed and self-employed individuals can earn up to four work credits per year for Social Security purposes. Self-employed individuals earn one credit for every $1,069.00 of net earnings reported. If you have reported your earnings accurately each year and have earned enough work credits through your self-employment history, you will be able to qualify for SSDI Social Security Disability benefits. You will, however, still need to prove that you are completely unable to work in order to be approved for disability payments.
Breaking it Down
The easiest way to understand whether or not a self-employed individual is eligible for Social Security Disability benefits is to understand that for employed individuals, the employer is responsible for reporting income to the federal government and paying the employees Social Security taxes. For self-employed individuals, that responsibility is their own. Both employed and self-employed individuals have equal rights to Social Security Disability benefits, but a self-employed individual must be diligent in reporting his or her income in order to receive the benefits he or she is entitled to when that person becomes disabled.
Other than income reporting requirements, the eligibility criteria for self-employed individuals is the same for any other person who applies for Social Security Disability benefits. A self-employed individual will need proper medical documentation proving that they have a qualifying disability that the disability is expected to last at least one year or longer.
Hiring a Social Security Disability Attorney
If you are self-employed and have become disabled, you may want to consult with a Social Security Disability attorney regarding your disability claim. An attorney can help you determine how solid your claim for disability benefits is and he or she can help you obtain the necessary medical evidence to file your disability application.
If your initial application for Social Security Disability benefits is denied (as 70 percent of applications normally are) then your attorney will be able to help you appeal the Social Security Administration's decision. Statistics show that individuals who have an attorney representing them through the Social Security Disability appeal process are more likely to win their appeal than those individuals who do not have a Social Security Disability attorney representing them.