I rewrite this article every year because it continues to affect clients and the consequences are HUGE! We see cases month after month where Claimants lose all benefits or a large portion of disability because they filed a tax return fraudulently. Many times these returns are filed without the filer having knowledge of how it will affect a claim for disability.
If you have filed a claim for Disability Insurance Benefits (DIB) or Supplemental Security Income (SSI), the earnings you report on your tax return can and will affect your claim for benefits. If you have worked and earned income, it is important to file your taxes and report that income accordingly. However, if you have not worked or earned very little income, but report an inflated amount of self-employment income in order to receive an Earned Income Credit (EIC), your past due benefits WILL be affected.
Do not be lured into falsely filing self-employment for large income tax returns as this can cause you to lose all disability benefits for that tax year. Additionally, filing an erroneous EIC credit can cause you to be ineligible to file that credit again for 2 or 10 years, if it is determined to be fraudulent or erroneous. Again, please consult with your tax preparer regarding your claim for disability benefits, and if you need additional tax advice, contact a qualified tax attorney. Also, keep a copy of your tax return if you have a claim pending for disability, as this will be requested by the Social Security Administration.
We are not tax attorneys and recommend you consult with a local tax attorney if you need further guidance in processing a tax return.
If you are disabled and in need of assistance navigating the disability process, call one of the experienced disability representatives at Gardberg & Kemmerly, P.C. today at 251-343-1111 for a free consultation. Gardberg & Kemmerly specialize in helping the injured and disabled in Alabama, Mississippi, Florida and Louisiana.