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How are SSD and SSI different?

If you've been wondering about the difference between SSD and SSI, you're not alone. The two federal benefit programs have similar names: Social Security Disability (SSD) and Supplemental Security Income (SSI). The do similar things: provide benefits to people who cannot work. But the similarities end there. Read on to learn about the differences between SSD and SSI.

Social Security Disability benefits are paid to people who can no longer work because of physical or mental impairments - impairments that have lasted or are expected to last for a minimum of twelve months or to end in death. Although designed for people who have worked for a certain amount of time and have paid into the system through payroll taxes, SSD benefits are also paid to minor children, widows, and to adults who have had a lifelong disability that prevents them from working.

Supplemental Security Income benefits are paid to low-income people 65 and older, to disabled adults who have not worked enough to pay into the SSD system, and to children who are disabled or blind. The program is designed for people with limited income and assets. Unlike SSD, the SSI program is funded by general tax revenues, rather than payroll taxes.

The programs were established at different times and for different purposes. SSI was begun in 1974, when Congress took over many different state welfare programs and consolidated them under the Social Security Administration. The benefits are not tied to a person's work history. And, to add to the confusion, federal SSI benefits may be supplemented by state programs.

SSD was started in 1960, when Congress changed Social Security law to allow the agency to pay benefits to disabled workers of any age and their dependents. Like retirement benefits, SSD benefits are based on the recipient's work history.

SSD has no asset restrictions - it is based entirely on your work record and the agency's determination of your disability. In contrast, SSI calculates the recipient's assets - cash, property and other assets. If those assets exceed a certain amount, no benefits will be paid, although a home and one car are not usually counted. .

If you are disabled and are having trouble receiving benefits, contact Binder & Binder ®, the national social security disability advocates. Learn how we can help.

Source: AARP Bulletin, "What's the Difference Between SSDI and SSI?" by Stan Hinden, June 13, 2012.

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