It is not uncommon for a Social Security Disability claim to spur from a workplace accident. However, many claimants do not realize that any worker's compensation funds received can reduce the amount of disability benefits to be received. The Social Security Administration offers a publication describing these rules in detail, which can be viewed here.
If a Social Security Disability claimant receives workers' compensation benefits from federal, state, or local government, federal or state workers' compensation agencies, or from an employer's insurance company, then that benefit, in addition to a disability benefit, cannot amount to more than 80% of the average amount earned before becoming disabled. Also included in this rule are public disability payments such as state or government retirement benefits due to disability, temporary disability benefits paid by the state, or any federal, state, or local government payment for a medical condition which rendered the claimant unable to work.
Consider this example. Sally became disabled two years ago due to an injury on the job, and has been receiving workers' compensation payments from her employer's insurance company in the amount of $500 per month. She was averaging a $2,500 per month wage while she was able to work. Sally filed for Social Security Disability, and her claim was approved. Her work credits made her eligible to receive $1,700 per month. However, according to the rules of the Social Security Administration, she could not be paid more than 80% of her average paycheck before becoming injured and unable to work. Since she made $2,500 per month while working, this limited her to receiving $2,000 per month total from all benefits. The monthly sum of the $500 workers' compensation benefit, plus the $1,700 disability benefit equaled $2,200. Therefore, her disability benefit would be reduced by $200.
A Social Security Disability attorney may be able to offer assistance in determining whether any additional benefits a claimant is receiving may reduce the amount he or she would receive once approved.