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Debate over how to fund New Jersey Social Security Disability

One of the great things about the United States is that it provides certain social safety nets for people who need assistance at different points in their lifetimes. One of these safety nets is the Social Security Disability (SSD) system, which provides financial benefits for people who have suffered a work accident, physical injury or qualifying illness and are unable to work as a result. Unfortunately, the funding of the Social Security Disability is a topic of frequent dispute among politicians.

Due to increases in the number of people applying for SSD benefits, as well as instances of fraud, the reserves of the SSD fund are not currently expected to last beyond 2016. Federal law limits the paying out of benefits by requiring appropriate revenues in the two different funds that make up the Social Security system before benefits can be paid: the fund that pays benefits for elderly individuals and the fund that pays disability benefits.

Aside from the reserves, incoming tax revenue is used to pay benefits, but current levels of tax revenue are sufficient to cover only 81 percent of the disability benefits scheduled to be paid out. For this reason, President Obama recently put forth a plan to move approximately $330 billion from the retirement fund to the disability benefits fund in the 2016 budget. Republicans in the Senate are challenging the plan, however, and believe that it does not provide a lasting solution to the "looming crisis."

Many people may be unfamiliar with the SSDI system that provides financial benefits to disabled individuals who are unable to work because the discussion about SS retirement benefits tends to dominate. The reality is that benefits for qualifying disabled individuals are available, and hundreds of thousands Americans receive and rely on these benefits every month.

In order to be eligible for SSD benefits, an applicant must have a qualifying illness or injury that prevents him or her from working. In addition, the condition must be expected to last for more than a year. The list of qualifying illnesses and injuries is quite extensive, so individuals may have a better chance of qualifying that they realize. The program is funded by workers paying into the system during their years of employment, so those workers who are now suffering from a disability should not hesitate to apply for the benefits to which they are entitled--and for which they have already paid.

Source: Fiscal Times, "Social Security Disability Funding Fix Hits Brick Wall," Eric Pianin, Feb. 12, 2015

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