What Is SSDI Back Pay?
SSDI Back Pay refers to benefits that you would have received from the time when you apply for benefits to when your claim is approved, minus a 5 month waiting period. SSDI retroactive back pay can also include compensation for when you were diagnosed with your disability to when you were approved for SSDI. You will receive your accrued Back Pay after you are approved for SSDI.
Since most claims are denied one or more times before the claimant is approved for benefits, the Social Security application process is usually lengthy, and months or years can go by while waiting for approval. Back Pay is just another term for past due benefits that have accrued during the approval process.
How Is SSDI Back Pay Determined?
Back Pay is determined in relation to the date you filed your disability claim and the date that the Social Security Administration (SSA) decides that your disability began, also known as the “established onset date.” The established onset date is determined by a DDS examiner or an administrative law judge, based on your available medical records.
How Back Pay is distributed will depend on whether a claimant is approved for Social Security Disability Insurance (SSDI) benefits, Supplemental Security Income (SSI) benefits, or both.
SSI disability benefits accrue from the date that you filed your application. Even though you may have been subsisting on very limited resources for months, you will not always receive your Back Pay immediately after your case is approved. Sometimes the Social Security waiting period is longer if your case must be decided by an administrative law judge. In addition, SSI Back Pay is paid incrementally only, meaning you won’t receive all of you Back Pay in a lump sum as you would with SSDI. The stated reason for the delay is that lump sum payments would put too much of a strain on SSI’s financial resources.
If You Are Awarded Back Pay
If you are awarded both SSDI and SSI benefits, you may have to wait longer for your Back Pay than you would if you were only receiving SSDI benefits.
SSDI disability benefits can accrue either from the initial date of application, or as far back as twelve months prior to the date of application, less a five-month waiting period. The five-month waiting period is, for all practical purposes, an arbitrary elimination of what would have been your first five months of benefits. The longer you wait for approval of your case, therefore, the less this waiting period will affect you. To better understand the 5 month waiting period, we can look at two examples:
- If your claim is approved five months after you apply for benefits, you will not be entitled to Back Pay (5 month approval process, less 5 month waiting period). If your claim is approved a year after application, you will be entitled to seven months of Back Pay (12 month approval process, less 5 month waiting period).
- If your claim is approved 24 months after application, your will be entitled to 12 months of Back Pay (even though a 24 month waiting period less a 5 month waiting period is 19 months, the limit for Back Pay is 12 months).
Unlike SSI, Back Pay owed under SSDI can be received as a lump sum, although when payment will arrive is somewhat unpredictable. It has happened that a beneficiary finds his or her Back Pay benefits deposited without notice to their bank account even before they are notified that their disability claim has been approved. Sometimes a person receives regular benefits prior to Back Pay, but other times the Back Pay is paid first.
Your benefits may also be adjusted in accordance with Social Security’s windfall offset provisions. The amount of SSI benefits awarded is based on a claimant’s income, so if you qualify for benefits under both SSDI and SSI, your Back Pay under SSDI will count as income for SSI purposes. When Back Pay is paid, your SSI benefits will automatically be reduced to take into consideration this Back Pay “income.” The adjustment to SSI benefits is calculated by treating your SSDI Back Pay as having been available to you throughout the disability period.
Consult with a Social Security Attorney or Advocate
In many cases, a qualified Social Security Disability attorney can provide invaluable help in establishing a favorable onset date so that you are awarded the most Back Pay possible Fill out our Free Disability Evaluation to speak with an attorney.