SSDI vs SSI

[JennK2009]

What is the name of your state (only U.S. law)? Wisconsin

Asking on behalf of my significant other.

He was just given a lump sum from the Social Security Administration for “disability”. Because they are both administrated by the SSA, we do not know what exactly he qualified for. He had a terrific caseworker that nudged him through the system, but she isn't returning his calls about this check.. He just got a large lump sum in the form of a check from the Treasury (Soc Sec for Ins) was the memo. He applied in March and apparently got accepted in July. Fast.

He put the check in the bank because it came with no explanation. None. Shouldn't he have gotten some form letter, at least? We combed through the paperwork, but are not sure if it is SSI or SSDI. I think it is SSDI because he gets a pension is above poverty level. And, I think SSI is for additional money?

My question is: Is he liable for taxes,? Is SSI earning people liable for taxes?

From what I have googled, one is social security funded and one is federally funded. He was a union guy, worked many years, paid into SS, blah, blah, blah. Bank owns half his home. No other assets. He does have a tax guy that's been doing his taxes for many years, but he's on vacation, too.

He is setting aside some monies owed for taxes, but not sure how much. Once you consider the tax bracket for his pension verses however how much money he needs to pay with this extra income (?) Are they going to tell him? Add on the (Medicare in two years?) insurance business, and I'm lost. And, something about spending this lump sum within six months(?)

I understand I am not a legal party and promise not to give him any legal advice. But, for now, I have to ask the questions. He gave me permission ask you guys.

Thanks for any insight or direction.

 

[LdiJ]

What is the name of your state (only U.S. law)? Wisconsin

Asking on behalf of my significant other.

He was just given a lump sum from the Social Security Administration for “disability”. Because they are both administrated by the SSA, we do not know what exactly he qualified for. He had a terrific caseworker that nudged him through the system, but she isn't returning his calls about this check.. He just got a large lump sum in the form of a check from the Treasury (Soc Sec for Ins) was the memo. He applied in March and apparently got accepted in July. Fast.

He put the check in the bank because it came with no explanation. None. Shouldn't he have gotten some form letter, at least? We combed through the paperwork, but are not sure if it is SSI or SSDI. I think it is SSDI because he gets a pension is above poverty level. And, I think SSI is for additional money?

My question is: Is he liable for taxes,? Is SSI earning people liable for taxes?

From what I have googled, one is social security funded and one is federally funded. He was a union guy, worked many years, paid into SS, blah, blah, blah. Bank owns half his home. No other assets. He does have a tax guy that's been doing his taxes for many years, but he's on vacation, too.

He is setting aside some monies owed for taxes, but not sure how much. Once you consider the tax bracket for his pension verses however how much money he needs to pay with this extra income (?) Are they going to tell him? Add on the (Medicare in two years?) insurance business, and I'm lost. And, something about spending this lump sum within six months(?)

I understand I am not a legal party and promise not to give him any legal advice. But, for now, I have to ask the questions. He gave me permission ask you guys.

Thanks for any insight or direction.

Based on the facts you have given it just about has to be SSDI. SSI is for people who haven't earned enough credits over their work history to collect SSDI, and based on what you described that isn't him.

He needs to bank about half the money or so until he can talk to his tax guy. The formula for determining whether or not he is going to owe any taxes on the money is a bit complicated. If he has no other taxable income for 2014 he might owe nothing. If he has other taxable income for 2014 he could owe taxes on as much as 85% of the money, and how much those taxes would be would depend on his tax bracket.

 

[JennK2009]

Based on the facts you have given it just about has to be SSDI. SSI is for people who haven't earned enough credits over their work history to collect SSDI, and based on what you described that isn't him.

He needs to bank about half the money or so until he can talk to his tax guy. The formula for determining whether or not he is going to owe any taxes on the money is a bit complicated. If he has no other taxable income for 2014 he might owe nothing. If he has other taxable income for 2014 he could owe taxes on as much as 85% of the money, and how much those taxes would be would depend on his tax bracket.

Thank you very much! I will pass this information along. I'm pretty sure it is SSDI, too. It's been a week with no explanation so he's just sitting on it now and put the tax guy on notice that he's going to need a review. If, this check isn't a mistake. He learned the lesson the hard way with taxes when he first started his pension, so he's more apt to listen to me (well, the tax guy) this time.

 

[JennK2009]

He got the letter today. It's SSDI, so he's going with Plan A to stash at least half for taxes and not do anything major until he talks to the tax guy. Thanks for your reassurance on the matter. I read him your response and he scowled but I could see his hamster starting to run.

Any non legal advice? Can he send his caseworker some flowers or something to express his appreciation? I have never heard of a disability cases going thru so quickly. It would be nice to thank her for navigating him through this process.

The Social Security System Administration (SSSA, just in case you weren't confused enough) did enclose a handy dandy booklet on how to proceed from here. Nice and simple, step by step. Thank God

He's very unhappy about the direct deposit condition and the need for computers and internet. I told him it's time to move past Mouse 101, over a nice fish fry, of course.

 

[LdiJ]

He got the letter today. It's SSDI, so he's going with Plan A to stash at least half for taxes and not do anything major until he talks to the tax guy. Thanks for your reassurance on the matter. I read him your response and he scowled but I could see his hamster starting to run.

Any non legal advice? Can he send his caseworker some flowers or something to express his appreciation? I have never heard of a disability cases going thru so quickly. It would be nice to thank her for navigating him through this process.

The Social Security System Administration (SSSA, just in case you weren't confused enough) did enclose a handy dandy booklet on how to proceed from here. Nice and simple, step by step. Thank God

He's very unhappy about the direct deposit condition and the need for computers and internet. I told him it's time to move past Mouse 101, over a nice fish fry, of course.

While I am sure it would thrill the caseworker to get flowers, it might actually cause her some problems at her office. Therefore, its really better not to do so. A sincere thank you note however would be very appropriate.

 

[JennK2009]

While I am sure it would thrill the caseworker to get flowers, it might actually cause her some problems at her office. Therefore, its really better not to do so. A sincere thank you note however would be very appropriate.

Thanks LdiJ; I was kind of thinking along those lines as well. A thank you note, it is.

Thanks again for your help, too. I was dreading going into the weekend without knowing what the heck was going on. That stuff is so confusing.