The Connecting Point Volume 2 Issue 12
Date January 28th, 2005

In This ISSUE:

1) SSA Disability Starter Kits
2) A consumer guide to public Vocational Rehabilitation (VR)
3) IRS changes to the tax code
4) 2005 National Council on Independent Living Statement of Values On Social Security and Private Accounts, Social Insurance and My House on Fire

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1) SSA Disability Starter Kits – The SSA (Social Security Administration ) Starter Kits are available for children under 18 as well as adults. The starter kits provide information about specific documents and the information that the SSA requests from its beneficiaries. The kits also provide general information about the disability programs and the SSA decision-making process, taking away some of the mystery of applying for benefits. Each Disability Starter kit contains a frequently asked question fact sheet, a checklist o documents and information SSA requests, and a worksheet to help gather and organize the information. The kits for children and adults are available in both English and Spanish on the web site.

http://www.ssa.gov/disability/disability_starter_kits.htm .

2 ) A consumer guide to public Vocational Rehabilitation (VR) How can my state's VR agency help me find a job? How do I apply? What if I am put on a waiting list? ICI's new brief guides consumers and their helpers through the basics of this important public resource. In addition, the brief shares advice from consumers who made VR work for them.

Getting the Most from VR –

http://www.communityinclusion.org/publications/pub.php?page=newpubs

3) IRS changes to the tax code

As we head into tax season, parents need to be aware of some IRS changes to the tax code as it relates to kids with disabilities. A good overview of this topic can be found at:
http://www.schwablearning.org/articles.asp?r=773

For those of you paying out of pocket for transportation, special schools, OT, PT, etc., please read this carefully and learn all you can so you know what you are entitled to

4 . 2005 National Council on Independent Living Statement of Values On Social Security and Private Accounts, Social Insurance and My House on Fire

NCIL values both social insurance as well as savings and investments as successful tools to plan and contribute to an inclusionary life. NCIL values and supports institutions such as Social Security and the tax code as the vehicles for providing social insurance and individual and family saving and investment incentives respectively.

NCIL will vigilantly scrutinize proposals that confuse, sacrifice or do harm to one means of providing security for the perceived benefit of other financial tools or products.  NCIL believes strongly that social insurance, in contrast to private saving and investment, is a distinct and separate mechanism for the common goals of independent and productive living in one's community.

America's successful role in establishing social insurance in a free society during the 1930's is unparalleled in our history and has been replicated around the world. The American model, Social Security with its links to Medicare, contains a family package of insurance that mitigates or reduces poverty and maintains health care for family members of all ages.

"The Social Security programs are insurance programs, not investment programs, designed to reduce risk from certain life events." - Marty Ford, Consortium for Citizens with Disabilities

Social Security has solvable financial challenges. According to most American social insurance experts, including Social Security actuaries, Social Security is not broken.

•  Social Security equitably funds itself from employer and employee payroll taxes dedicated to paying social insurance products when conditions in the policy are met.

•  Social Security is pooled risk group insurance. The larger the family of contributors to the pool, the healthier and safer the benefit returns.  NCIL believes that proposals to increase participancy in social insurance can increase the safety and long-term solvency of trust funds providing benefits.

•  Social Security pays a benefit when a covered family member meets the event criteria in the policy requirements, not because a family member has enough private savings.

•  Categories and sources of  Social Security disability benefit payments:

• disabled workers and their dependents, including disabled adult children, draw benefits from the disability insurance program;
• retirees with disabilities draw retirement benefits;
• disabled dependents of retirees, including disabled adult children, draw their benefits from the retirement program; and
• disabled survivors, including disabled adult children and disabled widow(er)s, draw their benefits from the survivors program.

Not even including Social Security retirement benefits paid, and including the disability benefits paid in Social Security's Supplemental Security Income Program (SSI), NCIL estimates from the private account literature to date that the men, women and children of at least 10,000,000 American families would be adversely affected by reductions in benefits caused by introducing private accounts into social insurance.

Millions of Americans pay home-owners' fire insurance premiums. Many more millions pay into 401(k)s and other IRS approved Individual Retirement Accounts (IRAs and Roth IRAs). When someone's home burns down, Social Security and the Roth IRA have no interest in the event. The home-owner's fire insurance policy has interest in the event. If the Social Security beneficiary informs the fire insurance company they have to pay less for their fire insurance to meet new savings goals, the fire insurance company may well lower the premium to keep the customer, and lower the fire insurance coverage to stay in business.

Retirement investments and savings will not replace your home burned down. The appropriate amount of fire insurance is the method most Americans use to meet this unplanned event. If your home does not burn down, you receive nothing but peace of mind and security. If it burns down, you get a new home from the insurance policy. This is not rocket science.

The disability community urges Congress to request a beneficiary impact statement from SSA on every major proposal for Social Security private accounts, or every component of a proposal, under serious consideration before Congress. In a program with such an impact on millions of people of all ages, it is simply not enough to address only the budgetary impact of change. The “people impact” must be studied and well understood.

For people with disabilities, our very lives depend on such analysis.          

Individual and Family Saving: A Government-Supported Policy Objective

NCIL values and educates members on Individual Development Accounts, IRS-approved retirement products, and IRS tax code provisions such as IRAs and Roth IRAs. These policies support and reward individual and family initiative to save for the future. The federal and state tax codes have been the traditional vehicles for encouraging saving and investments, not America's social insurance system called Social Security.

NCIL will hold policymakers accountable. NCIL will ask policymakers to explain views, positions, and proposals that mix up, confuse or do harm to social insurance for the perceived or unfounded benefit of other financial tools for independent living.

In January, 2005, Vice President Cheney said, without context or explanation:

"Young workers who elect personal accounts can expect to receive a far higher rate of return on their money than the current system could ever afford to pay them." (Associated Press, 1/14/05)

NCIL offers this context:

“For the average wage earner with a family, the Social Security Administration (SSA) has estimated that OASDI insurance benefits are equivalent to a $400,000 life insurance policy or a $350,000 disability insurance policy.”

NCIL and its disability community partners such as the World Institute on Disability promote saving with the Access to Assets Program and Equity Webzine at www.wid.org , as well as using social insurance when applicable. See also Disability Benefits 101 at www.DB101.org .

NCIL members state: “Social insurance and savings … Never one at the expense of the other.”

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