I Filed too Early!

CMiller
5 days ago
4 min read

One of the most common concerns I hear from clients is:

“I think I applied for Social Security benefits too soon. Did I make a mistake?”

The good news is that not necessarily.

Whether you applied for Social Security Disability Insurance (SSDI) or Social Security retirement benefits, you may have options depending on your situation. In many cases, it’s possible to adjust your strategy without losing all of your rights.

Let’s look at a few common situations.

Scenario 1: You Applied for SSDI but Your Health Improved

Imagine this:

You suffer a serious back injury and are unable to work.

You begin receiving workers’ compensation or California State Disability Insurance (SDI) benefits. As those benefits begin to run out, you’re still unable to work, so you apply for Social Security Disability Insurance (SSDI).

While your SSDI claim is pending, you undergo surgery. Fortunately, your condition improves, and your doctor releases you to try returning to work.

Now you’re wondering:

Should I withdraw my disability claim?

My Advice: Don’t Rush to Withdraw Your Application

Many people assume that once they attempt to return to work, they should immediately cancel their disability claim.

In many situations, that’s not the best decision.

Instead, it may make sense to allow your claim to continue while you determine whether you can successfully return to full-time work on a sustained basis.

Many medical conditions improve initially, only for symptoms to return after weeks or months of working. If you’ve already withdrawn your claim, you may have to start the entire application process over.

Every case is different, but it’s often wise to be certain your return to work is successful before giving up your pending claim.

Social Security Encourages People to Try Working

Many people are surprised to learn that Social Security actually encourages beneficiaries to attempt returning to work.

Depending on your circumstances, several work incentive programs may help protect your benefits while you test your ability to work, including:

· Trial Work Period (TWP) for eligible SSDI beneficiaries.

· Extended Period of Eligibility (EPE) after a Trial Work Period.

· Unsuccessful Work Attempt (UWA) rules, which may apply if your return to work is brief because of your medical condition.

These rules are complicated, and the best strategy depends on where you are in the disability process.

Keep Good Records

If you decide to attempt returning to work, document your experience carefully.

Consider keeping notes about:

· Accommodations your employer provided.

· Tasks you could no longer perform.

· Pain or symptoms that worsened while working.

· Missed workdays due to your condition.

· Reduced hours or productivity caused by your disability.

This information can become valuable evidence if your condition prevents you from continuing to work.

You May Qualify for a Closed Period of Disability

Sometimes people recover after being disabled for an extended period.

If your medical condition prevented you from working for at least 12 consecutive months, but you later recovered and returned to work, you may still qualify for a Closed Period of Disability.

A closed period allows Social Security to award disability benefits for the time you were disabled, even though you are no longer disabled when the decision is made.

Many people never realize this option exists.

Scenario 2: You Started Retirement Benefits Too Early

Another situation I see involves early retirement.

Perhaps you lost your job at age 62 and believed claiming Social Security retirement benefits was your only option.

A year later, your financial situation improves, or you decide you’d like to continue working.

Now you’re wondering:

Can I change my mind?

The answer may be yes.

Withdrawing Your Retirement Application

In many situations, Social Security allows you to withdraw your retirement application within 12 months after your entitlement begins.

If approved:

· You must repay all retirement benefits you and any family members received based on your application.

· No interest is charged on the repayment.

· It’s as though you never filed.

· This option is generally available only once during your lifetime.

For many individuals, withdrawing early retirement benefits allows them to continue working and potentially receive significantly larger monthly retirement benefits later.

What If More Than 12 Months Have Passed?

If you’re outside the 12-month withdrawal period, you may still have options.

If you continue working, Social Security reviews your earnings each year.

Because retirement benefits are based on your 35 highest-earning years, additional years of higher earnings may replace lower-earning years in your record, increasing your monthly retirement benefit.

In addition, if you have reached your Full Retirement Age (FRA), you may work and earn as much as you like without your retirement benefits being reduced because of your earnings.

If you are younger than your Full Retirement Age, Social Security’s annual earnings test may temporarily reduce your retirement payments if your earnings exceed the yearly limit established by law.

Every Situation Is Different

No two Social Security cases are exactly alike.

Whether you’re considering:

· Returning to work after filing for SSDI,

· Applying for a Closed Period of Disability,

· Withdrawing an early retirement application,

· Understanding workers’ compensation offsets,

· Coordinating California SDI and SSDI,

· Or deciding when to file for retirement benefits,

the best course of action depends on your individual circumstances.