YOU ASK:

Can you qualify for social security disability with a LLC?

WE ANSWER:

If by LLC, you mean Limited Liability Company, yes, you can qualify for social security disability.

An LLC is usually used by a self-employed individual or a group of individuals who are concerned about getting protection for liability, the same limited liability protection provided by a corporation. It gives the owners or members of the LLC some level of protection for liability due to acts of the LLC, as well as any debts incurred by the LLC. When it's established, it also should register for Social Security so that the members of the LLC are covered for disabilities and other benefits provided by social security.

An owner of the LLC pays a "self-employment" tax for Social Security, as well as for Medicare, based on the LLC's total net income.

The important thing with being eligible for Social Security disability benefits is that your previous and present jobs should be covered by Social Security and that you must meet the medical conditions or disability as defined by Social Security. Your disability should be such that you are unable to engage in "substantial gainful activity".

Other eligibility requirements are:

  • Work experience. You should have earned enough work credits to be eligible. You see, you earn work credits for every year that you work, regardless of whether you work under an LLC, any other kind of company set-up or are self-employed. Work credits may also be based on wages or income from being self-employed. For the year 2010, $1,120 of wages or income, you get to earn one point. You can earn as much as four credits in a year. You can qualify for social security disability if you earn at least 40 work credits. 20 of these work credits should be earned within the last 10 years prior to the year you get disabled.
  • Age. There are also instances where young workers are accepted as eligible, even with fewer credits, in consideration of the person's age.
  • Ability to do work you were able to do prior to the disablement. If your disability is not caused by a disease or condition that is not in the list outlined by Social Security, you can still be considered if the impairment causes you to be unable to do the work you did previously.

Thus, Social Security disability eligibility is not based on what kind of company you work in, but in your length of employment, as well as with other factors.

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