Unemployment Benefits: How They Can Affect a Claim for Social Security Disability Benefits

Applying for and receiving unemployment benefits can pose a problem, especially if you have a claim for Social Security Disability (SSD) or Supplemental Security Income (SSI).  By applying for both sets of benefits, you are making two statements that are rather contradictory. First, by applying for and receiving unemployment benefits, you are claiming that you are able to work, but you are unable to find employment. By then applying for Social Security Disability or Supplemental Security Insurance benefits, you would be indicating that you are unable to perform any type of work as a result of a disability that has lasted, or is expected to last, at least twelve-months. Indicating that you are both able to work and unable to work simultaneously. Because these two statements contradict one another, it can lead to problems of credibility with regards to your disability. More specifically, if you indicate to one government agency that you can work, and then indicate to another that you cannot, an Administrative Law Judge may find your testimony regarding your claimed disability to be less credible.  

The good news, however, can be found in a memo that was issued on August 9, 2010. Therein, Frank A. Cristaudo, former Chief Administrative Law Judge, provided a reminder to all Administrative Law Judges that stated, “Receipt of unemployment benefits does not preclude the receipt of Social Security disability benefits. The receipt of unemployment benefits is only one of many factors that must be considered in determining whether the claimant is disabled.” So, what does this mean? Well, simply put, it means that while applying for and receiving unemployment benefits does not automatically preclude you from receiving SSD or SSI benefits, it will be one of the many factors and Administrative Law Judge will take into consideration when determining if you qualify to receive said benefits.

Understanding Supplemental Security Income and Your Resources

Supplemental Security Income (SSI) pays monthly cash benefits to people who are age 65 or older, those who are blind or those who have a disability and who do not own much or have a lot of income. The standard of disability is the same as with Social Security Disability (SSD). However, to qualify for Supplemental Security Income, a financial need threshold must also be met. SSI kicks in for the disabled when they do not qualify for SSD or the amount of SSD they will receive puts them below the financial standard.

When evaluating whether or not you qualify for SSI, the Social Security Administration looks at your resources. Resources, for instance, can be items such as cash; bank accounts, stocks, and U.S. savings bonds; land; life insurance; personal property; and anything else you own which could be changed to cash and used for food or shelter. In order to qualify to receive SSI, in addition to meeting the disability requirements, your countable resources must not be worth more than $2,000 for an individual or $3,000 for a couple. It is the total value of your resources that, when combined, are one of the factors that determine your eligibility for benefits.

Not all resources count for SSI, however. For instance, the Social Security Administration does not count the following: the home you live in and the land it is on; household goods and personal effects (for example, your wedding and engagement rings); burial spaces for you or your immediate family, as well as burial funds for you and your spouse, each valued at $1,500 or less; and one vehicle, regardless of value, if it is used for transportation for you or a member of your household—just to name a few.

One thing to keep in mind is the possibility of a future transfer of resources. Transferring a resource involves either giving it away or selling it. For example, an individual may, under their current circumstances, qualify for SSI benefits. However, a decision to transfer a resource may result in the ineligibility for SSI for up to 36 months. The length of time you would be ineligible for SSI is dependent upon the value of the resource that was transferred. Conversely, if the value of a resource that was transferred does not bring the total of your countable resources over the $2,000 limit for an individual or $3,000 limit for a couple, your eligibility would remain intact.

As always, we recognize that the circumstances are different for each of our clients, and we will do our best to make you aware of the process along the way. While we cannot change the Social Security Administrations requirements, we are always available to answer any questions our clients may have!