Earning Social Security on the Battlefield and the Home Front
More than 20% of Social Security beneficiaries- 9.3 million as of 2010- served in the U.S. military.(1) Military personnel on active duty have had Social Security tax deducted from their paychecks since 1957. Thirty-one years later (1988) Congress passed a law including those on inactive duty, such as individuals serving in the reserves. Members of the military also contribute to Medicare. In most cases, benefits received from the Veterans Administration have no- or a minimal- impact on the amount someone receives from Social Security.
To be entitled to a retirement benefit, soldiers have to meet the same minimum requirements as civilian workers: They must have earned at least 40 Social Security “credits” and be at least age 62.(2) Spousal and family benefits also apply.
Those on active duty from 1957 through 2001 received “extra earnings credits” in order to boost their Social Security benefit amount.(3) Essentially, these were “phantom” earnings- no one actually got a bigger paycheck. On paper, however, the amount of earnings credited toward Social Security was increased by a maximum of $1,200 per year. This practice was stopped in 2002 as part of the Defense Appropriations Act.
Disability Benefits for Military Service
Wounded veterans who are receiving an additional benefit from the Veterans Administration may also qualify for Social Security Disability Insurance (DI). Based on a 2010 study, there were 771,000 disabled veterans receiving Social Security benefits that year. More than 60% of those under age 66 served during the Vietnam War.
The requirements for receiving Social Security Disability Insurance are different- and more stringent- than the VA’s. For instance, take a veteran who is classified as “100% P &T” by the VA, meaning she has a disability that is “permanent and total.” This does not guarantee that she meets the requirement for Social Security disability payments. These require that “a person must have a severe impairment that is expected to last at least one year or to result in death. The impairment must be so severe that the person would be unable to perform any substantial work.” In other words, although a soldier lost the use of an arm, she might still be able to find a job.
Receiving Disability Insurance from Social Security is not automatic. You must file for it. Veterans wounded while on active duty on or after October 1, 2001 and who receive a 100% P & T rating from the VA will have their applications put into a fast-track approval process. These claims will get priority processing at Social Security.
Benefits may also be available for a spouse and children. Even an ex-spouse might qualify for benefits if s/he was married to you for at least 10 years, is age 62 or older and still unmarried. (Benefits paid to family members or ex-spouses do not reduce the amount you receive.)
A good resource for more information is Social Security Disability benefits for Wounded Warriors: https://www.socialsecurity.gov/pubs/EN-05-10030.pdf.
Supplemental Benefits
In addition, wounded warriors who receive an honorable discharge might also qualify for Supplemental Security Income (SSI) benefits. This is a needs-based program. Currently, the basic benefit for an individual is an additional $733/month. When it evaluates your case, Social Security considers both the type and extent of your injuries as well as the assets that you own.(4) They also look at other sources of income you are receiving.
However, according to Social Security Spokesperson Dorothy Clark, the offset is not dollar-for-dollar. For instance, if your VA benefit is $500/month, Social Security reduces that to $480/month. Here’s a hypothetical case of how the math works:
SSI maximum: $733
VA benefit: -480
SSI benefit: $253
You cannot file for SSI online. You must make an appointment at your nearest Social Security office for an in-person interview. A specialist will also inform you of other assistance programs that you may qualify for.
1. https://www.socialsecurity.gov/policy/docs/ssb/v71n2/v71n2p1.html
2. In 2015 and 2016 you receive 1 “credit” of Social Security once you earn $1,220. Thus, you receive the maximum number of credits allowed per year (4) once your earnings hit $4,880.
3. See https://www.ssa.gov/planners/retire/military.html
4. If you own the home you live in, this is not counted. In most cases, neither is your car. However, cash, investments, bank accounts and other assets are taken into consideration when determining whether you qualify for SSI.