Disabled Adult Child Benefits: A Primer
What is the Disabled Adult Child Benefits Program?
People are generally familiar with Social Security disability for adult workers and disabled children. However there is a little-known Social Security program for adult children. Known as Disabled Adult Child benefits, or DAC, this program can have a huge lifetime impact on eligible beneficiaries, both in terms of financial and medical insurance. This article will discuss the ins and outs of this program, including some of the common pitfalls that DAC recipients face.
What are the requirements for DAC?
A DAC beneficiary is an unmarried adult child of a retired, disabled, or deceased worker. In order to qualify, the disability must begin between the ages of 18 and 22 and continue after age 22. Unlike with SSDI (Social Security Disability Insurance) benefits, there is no requirement that the disabled adult child worked enough to pay into Social Security through federal income taxes. The DAC benefit is based on the earnings record of the parent, not the disabled adult child.
The DAC program provides additional care for this segment of the population in recognition that disabled children age into adulthood with an inability to work, and the parents of disabled adult children are no longer around to provide care due to retirement, disability, or death.
It is important to understand that a person can claim DAC benefits at any age, so long as they can prove a continuous disability since their 22nd birthday. For example, worker George claims early retirement at age 62. George’s son Sam is 40 years old with an intellectual disability since birth. Sam has never worked. Because Sam has a disability that began prior to the age of 22, Sam can receive DAC benefits based on George’s earnings record. Sam would also receive DAC benefits if George died before collecting Social Security, or if George becomes disabled before full retirement age.
What are the differences between SSDI, SSI, and DAC?
Here is a quick round-up on the main differences between the three programs:
- SSDI: Social Security Disability Insurance are benefits based on the work history of the disabled person. SSDI beneficiaries worked for long enough to become “insured” for the disability program, then otherwise met the requirements for Social Security disability by becoming unable to work due to their disability.
- SSI: Supplemental Security Income is a low-income program for disabled children and adults. SSI beneficiaries do not need to have worked, however they must meet a strict asset test. The SSI and SSDI rules for establishing disability are the same.
- DAC: The disability criteria for a disabled adult child is the same as for SSI and SSDI, with one additional criteria. In addition to establishing disability under the five-step sequential evaluation, a DAC beneficiary is required to show that they have been under a continuous disability since prior to reaching age 22. Unlike with SSI beneficiaries, DAC beneficiaries do not need to meet a strict asset test. DAC beneficiaries must have a parent that has become disabled under SSA rules, has claimed Social Security retirement, or has died.
How Can You Qualify for the DAC Benefits Program?
If their disability began before 22, an adult can start receiving benefits if:
- Their parent is deceased
- Their parent has started receiving retirement or disability benefits
What is the eligibility?
The DAC claimant can also be a natural child, legally adopted child, stepchild, grandchild, step-grandchild, or equitably adopted child of the wage earner, provided that:
- They are unmarried, age 18 or older
- Their disability started before 22 and continues
- They meet the definition of disability for adults
The SSA applies a five-step evaluation to every claim for disability, including DAC claims. This five-step evaluation applies regardless of the disability being alleged or which program (adult SSI, SSDI, DAC) one is applying for. The following five questions will apply to a person applying for DAC benefits:
- Step 1: Are you working? If so, the SSA issues an initial step 1 denial. The severity of the alleged disability will not be considered. In most DAC claims, the disabled adult child has never worked regardless of age or only briefly attempted to work and the work did not rise to substantial gainful activity under the SSA’s rules. If the DAC applicant is not working, the SSA proceeds to step 2.
- Step 2: Does the DAC applicant have a severe impairment? A severe condition impacts the ability to perform basic work-related activities for at least 12 months.
- Step 3: Does the severe condition meet the requirements of Listed Impairments? In general, a listing level impairment is a high bar to clear since the medical criteria usually require strict objective medical findings in the treatment evidence.
- Step 4: Can the DAC applicant return to their past work? Past relevant work is any job performed in the past 15 years. Most cases involving a DAC claim will not involve past relevant work, so the SSA usually proceeds to step 5.
- Step 5: Can the applicant do any other type of work in the national economy? This is a complicated hurdle to clear for people applying for disability who are under the age of 50. Because a DAC must prove that the disability began prior to age 22, the under age 50 rules will apply at step 5 for every case.
Important Considerations/Important Things to Know About DAC
What if a DAC gets married?
A DAC who marries will likely lose their benefit and Medicare coverage. Even if the marriage ends in divorce or widowhood, the DAC benefit is permanently terminated unless limited exceptions apply. One exception is when a DAC beneficiary marries another Social Security beneficiary. Another exception occurs when a DAC beneficiary’s marriage ends due to divorce or widowhood, in which case the beneficiary can become re-entitled to DAC benefits if their other parent retires, dies, or becomes disabled. Therefore, a DAC recipient cannot marry a working spouse without losing federal benefits.
Because the program was created to help take care of disabled adult children when the parents are no longer able to due to a disability, retirement, or death, the benefit ends if another worker (the spouse of the DAC) is able to provide for the DAC beneficiary. A DAC also cannot earn a substantial gainful income due to work activity, or they will lose their benefit. See our article “Working While Receiving Social Security Disability Benefits” to read more on this topic.
Can a child already receiving SSI benefits continue to receive them?
Yes. The adult child can receive both SSI and DAC benefits, which come with Medicare eligibility. If the SSI benefit is greater than the DAC benefit based on a parent’s work history, the SSA pays the higher amount. When a child receiving SSI benefits reaches the age of 18, they can continue to receive disability benefits based on the adult disability rules. The adult disability rules involve the application of the five-step sequential evaluation discussed above. In fact, a child who continues to receive SSI benefits after reaching age 18 will have an easier time applying for DAC benefits when their parents retire, become disabled, or pass away. Because the SSA has already decided that the DAC beneficiary became disabled based on the adult disability rules after age 18, this is necessarily evidence of disability prior to age 22. (See https://scholarship.law.marquette.edu/cgi/viewcontent.cgi?article=1134&context=elders)
Can a working individual still receive benefits?
Working can present legal challenges for DAC beneficiaries. This is due to the requirement that the DAC applicant prove continuous disability since at least age 22. However, there are several exceptions to the general rule that a DAC beneficiary cannot work:
- The work is below SGA – Generally, work is considered substantial gainful activity (SGA) if it rises above $1,470 gross per month in the year 2023. Work that is below this threshold is arguably below SGA level income, and therefore not considered work for SSA purposes.
- The work was an unsuccessful work attempt – If the work is above SGA level, but it lasts for less than six months and stops due to the disabling impairment, the work was an unsuccessful attempt.
- The work was not gainful after deducting impairment-related work expenses – The SSA will deduct impairment-related work expenses, such as those for medical devices purchased to perform the work. If the income after these deductions is below SGA level, the work is not considered gainful activity.
- The work was performed under special conditions or was subsidized – If the DAC recipient is working in a sheltered work environment, the SSA will determine whether they are earning the income being paid. For example, some charities or governmental organizations provide jobs and job support for disabled adults under close and continuous supervision.
Tips to Avoid Losing DAC Benefits
There are a few actions you can take to ensure you do not lose your DAC benefits.
Can you lose program benefits?
Yes. If a DAC beneficiary marries a non-DAC beneficiary, they will lose the benefit. Also, if a DAC beneficiary starts performing substantial gainful activities and none of the exceptions discussed above apply, the benefits will stop.
What should you do in that case?
If you receive a decision from the SSA ceasing a DAC benefit, contact a disability lawyer right away. You have 60 days to appeal an unfavorable decision, and then request a hearing in front of an administrative judge. If the SSA decided that the performance of Substantial Gainful Work activity was the reason for the cessation, gather all pay stubs, impairment-related work expenses, and a detailed timeline of the work performed.
How a Disability Lawyer Can Help?
An experienced attorney can provide guidance regarding the DAC rules, including the common pitfalls of the program such as the marriage and work rules discussed above. An attorney will advise regarding the deadlines for filing the appeal. At the hearing level, the attorney will submit evidence, including, if applicable, a DAC’s job training program and supporting statements from work coaches. The attorney will also prepare the parents and DAC for testimony, and submit briefs regarding the applicability of SSA regulations.
The SSA has medical “Listings” that contain strict criteria for disability. If the SSA determines that a condition meets the requirements of a Listing, disability is automatically granted.
A parent who takes care of a disabled child under the age of 18 can receive benefits, even if that parent has never worked. The benefit will stop when the child turns age 16, unless the child remains disabled and is under the parent’s care.
Social Security Disability is an insurance-based system funded by federal income taxes. There are specific rules about the number of years a person has to work and “pay in” in order to be insured for the disability system. Therefore, the parents of a person between the ages of 18 and 22 are the only family members who have had the opportunity to earn enough income (and pay enough FICA taxes) to be eligible for Social Security Disability Insurance benefits. The DAC benefit is based on the work record (tied to the Social Security number) of the highest-earning parent. Therefore, in order to determine the highest potential DAC benefit amount, the SSA needs to know the Social Security numbers of both parents.
A DAC beneficiary is entitled to Medicare benefits.
The benefit will stop, unless the DAC recipient marries a spouse who is also on DAC benefits.