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SSDI- Working for cash, why can't I get benefits?

Many disability applicants have questions about Social Security Disability Insurance (SSDI) including how to qualify for benefits and how many work credits they have to accumulate to be considered insured. With the high unemployment rate it is not unusual for many workers to work periodically or to work odd jobs with payment “under the table” and not necessarily pay taxes on all of their earnings.

Recently on our disability forum we had an SSDI applicant ask, “Can I get SSDI benefits if I have only worked for cash and have not paid employment taxes?” This blog will discuss your options if you have not paid taxes on your earnings.

What is SSDI?

Social Security Disability Insurance or SSDI was developed in the 1930's and created during the political conflicts of the 1950's and 1970's. It has grown over the last thirty years to include an estimated 8.6 million disabled workers. To qualify for SSDI benefits you must prove that you are not able to work for at least 12 continuous months due to a significant illness or impairment. SSDI benefits are based on the disabled worker's “past earnings and are paid to the disabled worker and to his or her qualifying dependent family members.”

How do I earn work credits from the SSA

To qualify for SSDI benefits an applicant must be insured, which means they have earned a certain amount of money each year and paid employment taxes. According to the SSA, “in 2012, you receive one credit for each $1,130 of earnings, up to the maximum of four credits per year.”

SSDI applicants must generally earn 40 work credits (younger workers may need less work credits), 20 of which must be earned in the last 10 years ending with the year you become disabled. This last requirement is confusing to many disability applicants, many of which work for 10, 20 or 30 years and then stop working and fail to apply for disability soon enough. In this situation they may find that they are no longer “insured” because their work credits were not earned soon enough to their date of disability (talk to a disability lawyer about your options if you find yourself in this situation).

Workers who are disabled and no longer able to work are encouraged to apply for SSDI with the SSA as soon as they determine their condition will last 12 continuous months. Do not wait too long or you may find that you no longer have enough work credits.

What if I did not pay taxes and have no credits with the SSA?

If you worked for cash or you worked but did not pay taxes, unfortunately, you have not generated work credits and you will not be considered insured. The only option you will have is to see if you may qualify for Supplemental Security Income (SSI) which is monthly cash benefits for the aged, disabled or blind who cannot work but who do not have sufficient work credits for SSDI benefits.

There is no work around for applicants with insufficient work credits. You cannot buy work credits from the SSA, you cannot “borrow” them from your spouse and you cannot qualify for SSDI without sufficient credits. The only way to earn more work credits is to return to work and pay taxes.

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