Do You Need To Pay Taxes on Your SSDI Benefits?

June 30, 2023 | Social Security Disability

Do You Need To Pay Taxes on Your SSDI Benefits?

Whether or not your SSDI benefits are taxable depends on the amount of income you have from other sources. Other factors also determine tax liability for SSDI benefits. It is crucial that you carefully monitor your income to ensure you pay the taxes due, if any.

What Are SSDI Benefits in Pennsylvania?

SSDI is a program administered by the Social Security Administration (SSA). It stands for “Social Security Disability Income.” SSDI is a federal disability program for workers who have earned enough work credits and paid taxes to Social Security to qualify for disability benefits.

You must meet the requirements to qualify for SSDI payments. Those requirements are:

  • Have worked in jobs where you paid Social Security taxes 
  • Earned enough work credits to qualify for benefits
  • Have a condition that meets Social Security’s definition of disability
  • Earn less than the maximum monthly income to qualify for disability benefits 

Proving you have a disabling condition can be the most challenging requirement when applying for disability benefits. SSA has a strict definition of disability. 

Will My SSDI Benefits Be Taxable by the Federal Government? 

Many people do not pay taxes on their SSDI benefits. However, you could be required to pay taxes on disability benefits if you receive more than a certain threshold. The thresholds are adjusted, so you need to ensure you use the correct amount for the current tax year.

For 2022, the IRS said SSDI benefits could be taxable if any of the following situations apply:

  • You file a federal tax return as single, qualifying widow/widower, married filing separately, or head of household, and your combined income exceeds $25,000
  • You file a joint federal tax return with your spouse, and your combined income exceeds $32,000

Depending on your income, you could pay federal taxes on up to 50% of your SSDI benefits or 85% of your SSDI benefits. Your combined income is calculated by adding your adjusted gross income, non-taxable interest, and ½ of your Social Security benefits. 

How Do I Apply for SSDI in Pennsylvania?

The process and timeline of applying for Social Security disability benefits depend on whether your initial application is approved. However, the basic process of applying for disability benefits with the Social Security Administration is as follows:

Filing an Initial SSDI Application 

Filing an initial application for Social Security disability benefits online, by telephone, or in person at a Social Security Office. SSDI applications are very detailed and require detailed information about numerous areas of your life. You must provide your personal information, work history, medical history, and information about your daily activities. 

Appealing and Moving to a Hearing Level

It could take up to six months to receive a decision about your SSDI application. Roughly 60% of disability applications are denied. Therefore, you might need to appeal the decision. 

You must file the appeal within 60 days. If you did not hire a Harrisburg Social Security disability lawyer to assist you with the initial application, you might want to consult an attorney immediately. 

An Administrative Law Judge conducts the hearing. Preparing for the hearing can be complicated. You will likely be required to see an SSA doctor for an examination and might need medical experts to testify. An experienced disability lawyer understands what is required to argue cases before Administrative Law Judges successfully.

On the day of your hearing, the judge will not give you a decision. Instead, the judge considers the evidence presented at the hearing and issues a written opinion. You will receive the written opinion by mail.

Additional Appeals 

If the Administrative Law Judge denies your appeal, there are more appeals you can file. However, the process becomes increasingly complicated as you move through the appeals. You could also apply for benefits again if things have changed.

Contact a Lawyer To Determine Whether You Need To Pay Taxes on Your SSDI Benefits

An experienced Harrisburg Social Security disability lawyer understands the laws, requirements, and procedures you must comply with to receive SSDI benefits. Hiring a lawyer early in your case could give you a better chance of obtaining approval for your initial application or at the hearing level.

Most attorneys offer free consultations, so you don’t have to pay to meet with an attorney and discuss your options. Learning about your rights and options helps you know what to expect and what to do to receive disability benefits from Social Security. 

If you’ve been injured in a social security disability, please contact Marzzacco Niven & Associates at the nearest location to schedule a free consultation today:

Harrisburg Law Office
945 East Park Drive, Suite 103 Harrisburg, PA 17111
(717) 231-1640

York Law Office
2550 Kingston Road, Suite 210A York, PA 17401
(717) 995-8998

Wyomissing Law Office
833 N. Park Road, Suite 103, Room A Wyomissing, PA 19610
(717) 388-2325

Chambersburg Law Office
79 St. Paul Drive, Suite 1 Chambersburg, PA 17201
(717) 388-2378

Carlisle Law Office
354 Alexander Springs Road Carlisle, PA 17015
(717) 995-8732

Carbondale Law Office
30 Lincoln Avenue, Suite 101 Carbondale, PA 18407
(717) 995-8810

Lancaster Law Office
2173 Embassy Drive, Ste 123, Lancaster Pa 17603
(717) 616-2954

Lebanon Law Office
937 Willow Street, Suite D Lebanon, PA 17042-1140
(717) 995-8963