Social Security Disability and Early Retirement Benefits

An individual is eligible for disability benefits through the date of full retirement age.[1] For most people approaching retirement age, that is about 66. You can check your full retirement age at the SSA website here. That same individual would be eligible to elect early retirement benefits beginning at age 62. The issue of dual entitlement presents with some regularity under the following fact pattern: an individual who is 61 years old becomes disabled due to some medical condition. She then files for disability at 62, alleging that she became disabled at age 61. The claim is denied at the initial application, at reconsideration, and a request for hearing before an administrative law judge is filed. Due to the current backlog, it would be possible that this individual would not have her request for hearing addressed at a live hearing before a judge until the age of approximately 64. The question then becomes: can she elect to receive the reduced retirement benefit at age 62 while she waits for the hearing to address her entitlement to disability benefits?

Of course, the answer to that is always yes, she can elect to receive the reduced early retirement benefits, as the only condition to the receipt of those benefits is attaining a particular age – 62.

However, is important to understand the effect of electing to receive early retirement benefits while waiting on the adjudication of a disability benefit application.

The Risk: A person who is unsuccessful in establishing her entitlement to disability benefits prior to the election of early retirement benefits will be locked in to the early retirement benefit amount. This can result in the lifetime benefit being paid at 75% of what the full retirement benefit (or whatever the % is at the time the person elects to take early retirement–the percentage gets higher the closer the person is to full retirement age.

Assuming a person is successful in establishing her entitlement to disability benefits prior to the election of early retirement benefits, the full disability benefit is paid and the SSA just takes credit for what they’ve paid in early retirement benefits.[2]

Using the example above, let’s assume Person A was disabled at 61, elected early retirement at 62, and was found disabled (@ age 61) by a judge when Person A is 64 years old.

If the full disability benefit is $1,000 and the reduced early retirement benefit is $750, the SSA would owe Person A the following:

  • $1,000 for any month of entitlement (after five-full month waiting period);
  • $250 for every month that early retirement was paid; and
  • The benefit would be $1,000 moving forward.

Electing to receive early retirement while waiting on a disability hearing can be a very fact specific, and any decision to elect early retirement should be made after consultation with a qualified attorney regarding the matter. Our firm represents individuals in Social Security disability claims. For a consultation with one of our qualified Tampa disability attorneys contact our office today.

[1] This assumes the person is fully insured and has the requisite quarters of coverage, meaning they are insured for disability benefits on their alleged date of onset.

[2] POMS RS 00615.110 and 000615.020 https://secure.ssa.gov/poms.nsf/lnx/0300615020