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Will My Daughter's DAC Benefits Be Affected If She's Required To Participate In A 401(a) Retirement Plan?

Will DAC benefits be affected when a recipient is required to participate in a 401(a) retirement plan?
My child is currently receiving DAC benefits on her father's work record. Her current place of employment is requiring her to sign up for a 401(a) retirement plan where they will contribute to the plan based upon her salary. Her current salary does not equate to SGA. Is this considered countable income or a non-countable resource for purposes of her DAC benefit? Thank you!

Hi. When evaluating substantial gainful activity (SGA), Social Security looks at a person's gross wages. That's the amount before any deductions, like 401 plan contributions, are withheld. As long as your daughter's gross wages stay below SGA level before deductions, she should be okay. If your daughter's employer makes matching contributions to her 401, that wouldn't count as additional earnings for SGA purposes.

Disabled adult child's (DAC) benefits aren't needs based, so there's no limit on the amount of resources that a person can have and still be able to collect DAC benefits. So, the total amount that your daughter accumulates in her 401 won't affect her benefit eligibility.

Best, Jerry

Apr 4 2022 - 5:40pm
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