Nightmare: Some Americans to Lose Disability Benefits Due to Stimulus Payments

Nightmare: Some Americans to Lose Disability Benefits Due to Stimulus Payments

It appears that the stimulus checks have pushed some beneficiaries’ incomes above the threshold under which they are eligible for benefits, even though that isn’t supposed to happen.

Here's What You Need to Remember: “This massive $1.9 trillion package is also a significant win for disabled people in the U.S., though it won’t deliver all that the disability community had hoped for,” Andrew Pulrang wrote for Forbes.

Due to a misunderstanding between the Social Security Administration and other parts of the government, some Americans have lost their eligibility for disability payments, the HuffPost reported this week.

“The whole point of stimulus was to help people who were being harmed during COVID, and now there’s going to be people facing a cessation of benefits and they’re going to end up in a worse place,” Michelle Spadafore, senior supervising attorney with the New York Legal Assistance Group, told the news outlet.

It appears that the stimulus checks have pushed some beneficiaries’ incomes above the threshold under which they are eligible for benefits, even though that isn’t supposed to happen.

The report also noted that the “resource limit” of $2,000 for individuals and $3,000 for couples hasn’t been updated since 1989. President Biden, however, has proposed raising that figure, although the legislation has not yet been introduced.

“You’re going to give me a stimulus check to stimulate the economy, and I can’t go out under doctor’s orders and you’re penalizing me for having this money,” one man affected by the mistake said. “Now it’s going to cost me money to have this money.”

Back in March, around the time the American Rescue Plan passed, CNBC advised disabled Americans that they could save their stimulus check in what is called an ABLE account.

ABLE Accounts were brought into existence by the Achieving a Better Life Experience Act (ABLE) law in late 2014. The point of the law, per the Social Security Administration’s website, was to “ease financial strains faced by individuals with disabilities by making tax-free saving accounts available to cover qualified disability expenses.”

“The ABLE account allows you to stretch out the stimulus check,” said Charlie Massimo, senior vice president at Wealth Enhancement Group, told CNBC in the March news report. “You are not forced to spend it in 12 months.”

After the American Rescue Plan passed, Forbes looked at what the legislation does to help disabled people.

“This massive $1.9 trillion package is also a significant win for disabled people in the U.S., though it won’t deliver all that the disability community had hoped for,” Andrew Pulrang wrote for Forbes.

“In the two previous stimulus bills, only dependents under age 17 qualified for payments,” Pulrang’s piece in Forbes continued. “This bill adds adult dependents, including adult children with disabilities and older parents with age-related disabilities who are claimed on someone else’s income tax returns. So a significant number of disabled people who didn’t qualify for previous stimulus checks will get this one. This provision will help those disabled individuals, and the families they live with.”

 Stephen Silver, a technology writer for The National Interest, is a journalist, essayist and film critic, who is also a contributor to The Philadelphia Inquirer, Philly Voice, Philadelphia Weekly, the Jewish Telegraphic Agency, Living Life Fearless, Backstage magazine, Broad Street Review and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. Follow him on Twitter at @StephenSilver. This article first appeared earlier this year.

Image: Reuters.