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Your child’s government benefits journey, transitioning from one benefit to another, usually occurs over many years. Typically qualifying for SSI is the first step in your child’s government benefits journey. Often, the second step on your child’s journey is qualifying for Social Security Disability Insurance (SSDI) based on their work record. This article explains the eligibility rules for SSDI.
To be eligible for Social Security Disability Insurance, your adult child must satisfy the following requirements:
Let's go through the five requirements in more detail:
Requirement 1: Apply with Social Security
Receiving SSDI does not happen automatically. Your adult child must apply to Social Security for it.
Requirement 2: Be “Medically Disabled”
To qualify for SSDI, your child must meet Social Security’s definition of disability. In a previous chapter, we discussed Social Security's definition of disability. Social Security uses the same definition of adult disability criteria to establish SSI or SSDI eligibility. Suppose your child currently receives SSI and later applies for SSDI. In that case, your child will likely qualify as “disabled” for SSDI, assuming your child’s medical condition and work capability have not changed.
Requirement 3: Be “Fully Insured”
Fully insured means your child must have the requisite number of quarters of coverage (QC) when applying for SSDI.
What is a quarter of coverage?
Starting January first of every year, if your child works, your child will pay FICA taxes on their wages. Your child will pay 6.2 percent of their wage, and your child’s employer will match that amount. As your child works and pays taxes, your child earns Social Security credits. In 2023, for each $1,640 of earnings, your child earns one credit -- up to a maximum of four credits per year.
That means if a worker generates $6,560 of wages ($1,640 X 4) in January and pays the tax on that amount in January, that worker will earn four credits. Then, during that year, at the beginning of each quarter, Social Security will convert one of the credits to a quarter of coverage.
Why does Social Security use this process of converting credits to a quarter of coverage? Initially, the rule was that a worker had to earn coverage for each quarter of the year. However, that rule hurt seasonal workers. To fix the unfairness, Social Security now uses as their primary metric credits; as the year progresses, Social Security converts those credits into quarters of coverage.
Once a worker receives four credits, it does not mean they stop paying FICA taxes. The worker continues paying FICA taxes up to the “cap” which in 2023 is $160,200. However, regardless of how much a worker earns, one can only earn a maximum of four credits per year.
How many credits does your child need to be fully insured?
The general rule is to be fully insured, a claimant needs at least one quarter of coverage for each calendar year after they turned 21 up to the year before they became disabled. The minimum number of quarters of coverage needed is 6. The maximum number required is 40.
However, importantly, younger workers can qualify with fewer credits. For example, if your child applies for SSDI before age 24, to be fully insured, your child needs only six quarters of coverage.
Requirement 4: Be “Disability Insured”
To qualify for SSDI, not only does the individual need enough credits to be fully insured, but the individual must also obtain a certain number of credits in recent quarters -- the so-called recency of work requirement.
The general rule is you have disability-insured status if you 1) have earned at least 20 QCs during the last ten years and 2) are fully insured.
However, Social Security has a special rule for workers younger than age 31: Special Insured Status. If your child applies for SSDI before the calendar quarter of their 31st birthday, they must have one quarter of coverage for every two calendar quarters in the period beginning with the calendar quarter after the quarter of their 21st birthday and ending with the quarter they apply for SSDI. If the number of quarters in this period is an odd number, use the next lower even number. A minimum of six quarters of coverage is always required. Quarters of coverage earned before age 21 may be used if this is required to meet the requirement.
For example, if the worker at age 28 applies for SSDI, the worker must have 14 credits (28 years - 21 years = 7 years X 2 credits = 14 credits) during the seven years between 21 rather than the 28 credits (7 years X 4 credits) they would have earned working full time. Those 14 credits can be earned anytime during those seven years.
If the worker applies for SSDI before the quarter they turn age 24, the worker must have six credits in the prior 12-quarter period. Some of these quarters may have been earned before the worker attains the age of 21.
This disability-insured status requirement does not apply to individuals who are blind (as defined by Social Security).
Requirement 5: Either Not be Working or Working with Countable Earned Income Less Than Substantial Gainful Activity (SGA)
For non-blind individuals, the monthly SGA amount for 2023 is $1470. The monthly SGA amount for statutorily blind individuals for 2023 is $2460.
If your child meets the above five criteria, then your child can qualify for SSDI.
Importantly: Twenty-four months after your child qualifies for SSDI, your child will automatically be eligible for Medicare.
Remember, if your child qualifies for SSDI and the monthly SSDI cash benefit is less than the monthly federal SSI cash benefit, your child will become a concurrent beneficiary receiving SSDI and SSI.
Your child’s government benefits journey, transitioning from one benefit to another, usually occurs over many years. Typically qualifying for SSI is the first step in your child’s government benefits journey. Often, the second step on your child’s journey is qualifying for Social Security Disability Insurance (SSDI) based on their work record. This article explains the eligibility rules for SSDI.
To be eligible for Social Security Disability Insurance, your adult child must satisfy the following requirements:
- Apply with Social Security;
- Be medically disabled;
- Be fully insured;
- Be disability insured (this requirement does not apply to blind individuals);
- Be either not working or working with countable earned income less than substantial gainful activity (SGA).
Let's go through the five requirements in more detail:
Requirement 1: Apply with Social Security
Receiving SSDI does not happen automatically. Your adult child must apply to Social Security for it.
Requirement 2: Be “Medically Disabled”
To qualify for SSDI, your child must meet Social Security’s definition of disability. In a previous chapter, we discussed Social Security's definition of disability. Social Security uses the same definition of adult disability criteria to establish SSI or SSDI eligibility. Suppose your child currently receives SSI and later applies for SSDI. In that case, your child will likely qualify as “disabled” for SSDI, assuming your child’s medical condition and work capability have not changed.
Requirement 3: Be “Fully Insured”
Fully insured means your child must have the requisite number of quarters of coverage (QC) when applying for SSDI.
What is a quarter of coverage?
Starting January first of every year, if your child works, your child will pay FICA taxes on their wages. Your child will pay 6.2 percent of their wage, and your child’s employer will match that amount. As your child works and pays taxes, your child earns Social Security credits. In 2023, for each $1,640 of earnings, your child earns one credit -- up to a maximum of four credits per year.
That means if a worker generates $6,560 of wages ($1,640 X 4) in January and pays the tax on that amount in January, that worker will earn four credits. Then, during that year, at the beginning of each quarter, Social Security will convert one of the credits to a quarter of coverage.
Why does Social Security use this process of converting credits to a quarter of coverage? Initially, the rule was that a worker had to earn coverage for each quarter of the year. However, that rule hurt seasonal workers. To fix the unfairness, Social Security now uses as their primary metric credits; as the year progresses, Social Security converts those credits into quarters of coverage.
Once a worker receives four credits, it does not mean they stop paying FICA taxes. The worker continues paying FICA taxes up to the “cap” which in 2023 is $160,200. However, regardless of how much a worker earns, one can only earn a maximum of four credits per year.
How many credits does your child need to be fully insured?
The general rule is to be fully insured, a claimant needs at least one quarter of coverage for each calendar year after they turned 21 up to the year before they became disabled. The minimum number of quarters of coverage needed is 6. The maximum number required is 40.
However, importantly, younger workers can qualify with fewer credits. For example, if your child applies for SSDI before age 24, to be fully insured, your child needs only six quarters of coverage.
Requirement 4: Be “Disability Insured”
To qualify for SSDI, not only does the individual need enough credits to be fully insured, but the individual must also obtain a certain number of credits in recent quarters -- the so-called recency of work requirement.
The general rule is you have disability-insured status if you 1) have earned at least 20 QCs during the last ten years and 2) are fully insured.
However, Social Security has a special rule for workers younger than age 31: Special Insured Status. If your child applies for SSDI before the calendar quarter of their 31st birthday, they must have one quarter of coverage for every two calendar quarters in the period beginning with the calendar quarter after the quarter of their 21st birthday and ending with the quarter they apply for SSDI. If the number of quarters in this period is an odd number, use the next lower even number. A minimum of six quarters of coverage is always required. Quarters of coverage earned before age 21 may be used if this is required to meet the requirement.
For example, if the worker at age 28 applies for SSDI, the worker must have 14 credits (28 years - 21 years = 7 years X 2 credits = 14 credits) during the seven years between 21 rather than the 28 credits (7 years X 4 credits) they would have earned working full time. Those 14 credits can be earned anytime during those seven years.
If the worker applies for SSDI before the quarter they turn age 24, the worker must have six credits in the prior 12-quarter period. Some of these quarters may have been earned before the worker attains the age of 21.
This disability-insured status requirement does not apply to individuals who are blind (as defined by Social Security).
Requirement 5: Either Not be Working or Working with Countable Earned Income Less Than Substantial Gainful Activity (SGA)
For non-blind individuals, the monthly SGA amount for 2023 is $1470. The monthly SGA amount for statutorily blind individuals for 2023 is $2460.
If your child meets the above five criteria, then your child can qualify for SSDI.
Importantly: Twenty-four months after your child qualifies for SSDI, your child will automatically be eligible for Medicare.
Remember, if your child qualifies for SSDI and the monthly SSDI cash benefit is less than the monthly federal SSI cash benefit, your child will become a concurrent beneficiary receiving SSDI and SSI.