Overview of SSI and SSDI – What are Their Similarities and Differences?
In the United States, there are two major social welfare programs that provide assistance to people with disabilities: Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI). Both programs are run by the Social Security Administration (SSA), and both provide monthly benefits to qualifying beneficiaries.
There are a lot of misconceptions about SSI and SSDI. Some people think that they are the same thing, while others think that they are completely different. Here, we will take a closer look at these two programs and see how they are similar and how they differ.
What is SSI?
Supplemental Security Income (SSI) is a needs-based program that provides financial assistance to disabled individuals who have limited income and resources. SSI benefits are available to adults and children who meet the SSA’s definition of disability, and the monthly payments are based on the beneficiary’s needs.
In order to qualify for SSI, an individual must have less than $2000 in countable assets. This includes cash, savings accounts, investments, real estate, and personal property. Some items are exempt from this asset limit, including a primary residence, one vehicle, and burial plots.
Unlike SSDI benefits, which are funded by payroll taxes, SSI benefits are funded by general tax revenue. This means that SSI benefits are not subject to the same payroll tax rules as SSDI benefits.
What is SSDI?
Social Security Disability Insurance (SSDI) is a federally-funded insurance program that provides monthly benefits to disabled workers and their eligible family members. To qualify for SSDI, an individual must have worked long enough and paid into the Social Security system. The amount of the monthly benefit is based on the beneficiary’s earnings history.
SSDI benefits are funded by payroll taxes, which means that they are subject to the same payroll tax rules as other Social Security benefits. In order to qualify for SSDI, an individual must have at least five years of work history in the past ten years. If an individual has not worked recently, they may still qualify for SSDI if they have a severe enough disability.
How Are SSI and SSDI Similar?
There are a few ways in which SSI and SSDI are similar.
They both:
● Provide financial assistance to disabled individuals.
● Are run by the Social Security Administration.
● Have medical eligibility requirements.
● Make monthly payments to beneficiaries.
How Are SSI and SSDI Different?
Now that we’ve seen how SSI and SSDI are similar, let’s take a look at how they differ:
● SSI is needs-based, while SSDI is an entitlement program. This means that, to qualify for SSI, an individual must have limited income and resources. To qualify for SSDI, an individual must have worked long enough and paid into the Social Security system.
● SSI is funded by general tax revenue, while SSDI is funded by payroll taxes. This means that SSI benefits are not subject to the same payroll tax rules as SSDI benefits.
● The amount of the monthly benefit is different for each program. For SSI, the payments are based on the beneficiary’s needs. For SSDI, the payments are based on the beneficiary’s earnings history.
We hope this overview has been helpful in understanding the similarities and differences between SSI and SSDI. If you think you may be eligible for either of these programs, let us know and we'll be happy to guide you through the process.
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Dealing with a disability is hard enough without relevant financial support. Here at Chalk Law we provide legal advice to disabled people and assist with SSDI and SSI cases. Feel free to contact us today!