Divorce is often complicated, especially in high-asset cases where one spouse receives Social Security Disability Insurance (SSDI) benefits. Understanding how SSDI impacts divorce settlements is essential for both parties to reach a fair agreement.
Understanding SSDI benefits
SSDI provides financial support to individuals who cannot work due to a disability. These benefits are based on the recipient’s work history and contributions to Social Security. Unlike needs-based programs, SSDI does not consider income or assets when determining eligibility.
SSDI as marital property
In Florida, SSDI benefits are separate property. This means they belong solely to the disabled spouse and are not subject to division during the divorce. However, if a receiving spouse saved or used SSDI benefits to acquire assets during the marriage, those assets might be marital property and subject to division.
Impact on alimony and child support
Courts may include SSDI benefits when calculating alimony and child support. The disabled spouse’s income from SSDI can affect the amount of support they receive or pay. In high-asset cases, the court will examine all income sources to determine a fair support arrangement that considers both parties’ financial situations.
Dependent benefits and offsets
Children of a disabled parent receiving SSDI may qualify for dependent benefits. These benefits can impact child support calculations. Courts might offset the child support obligation by the amount the child receives from SSDI, ensuring the child’s needs are met without overburdening either parent.
Division of other assets
While SSDI benefits themselves are typically not divided, the presence of these benefits can influence the overall asset division. In high-asset divorces, courts aim for equitable distribution. They will consider all assets, including property, investments, and retirement accounts, to reach a fair settlement that reflects each spouse’s financial standing.
Protecting financial interests
Both spouses should disclose all income sources, including SSDI benefits, during the divorce proceedings. Transparency helps in creating a fair settlement. Financial advisors can assist in assessing the long-term impact of the divorce on each spouse’s financial health.
Understanding how SSDI benefits affect divorce settlements is important, especially in high-asset cases. By considering these factors, both parties can work toward an agreement that acknowledges their needs and secures their financial futures.