worried about unexpected income drop

[freshstart]

I thought I knew roughly what would happen once I started getting SSDI. I would get $1880 a month from them (low enough that it won't be taxed) and then my crappy long term disability company would decrease their payments but in a way so that I would still be getting ~2900 a month combined from both sources. LTD has been a nightmare, $1880 a month was a loan that I had to pay back when I got my SS settlement, which was the entire settlement. I knew this and was fine with that. I did not know that I had to pay taxes on all the money they paid me even though they took well over half of it back, so I owed 4k in taxes. I have to find an accountant who specializes in disability because none that I've asked have been able to answer my question, "shouldn't I get the taxes back on the amount I had to give back? I was taxed on money I couldn't keep." No one seems to know the answer to this. I've tabled this til tax season passes and maybe I can find someone with time to help me.

so the extra LTD to reach $2900 a month is supposed to continue until age 65 except my lawyers and lawyer friends all said expect about two years of payments and then they find a way to claim you are not disabled or the disability is depression and they only pay two years for that. So I expected LTD to stop that extra money in July of 2017. They dropped it now to $174 a month, claiming they are holding the rest as re-payment for back child support I got from SS. Except I didn't get that money. DD got overwhelmed with living here with me being so sick in the beginning (I really could not take care of her because I could not even take care of myself) and my mom having an end stage disease, that she went to live with her dad. So my ex with get about 9k in child support money from SSDI, not me, which makes sense.

LTD wants all sorts of legal documentation proving my ex will get the money and they said then they would think about re-instating my benefits. Think about it? Isn't it cut and dry- her ex got the money so she did not therefore we can continue to pay her? Of course not. I suspect I am going to end up needing a disability lawyer for this as well but since there's no big settlement at the end that they would get 25% of like they do for SSDI cases or they get nothing if I get nothing, I think I'm going to have a hard time finding one. I'll probably have to pay outright and I'm not sure it's worth the risk trying to fight a company that has such arcane rules.

I was counting on the 16 mos I had left of LTD money to save hand over fist for my EF. It went down with the tax bill and I needed a crown. I felt like I could manage living on just SSDI if I had saved enough during the 16 mos before LTD would likely end. I was not ready to start now. I don't have debt, a mortgage or a car loan. But I have high insurance and medical costs. My family and I had figured out I could continue to live here and contribute a fair amt as long as I didn't have to pay half the 13k in taxes. I feel terrible not paying that huge bill but the alternative was me moving to disabled housing and they (and I) really didn't want that and I hadn't thought about it, but it turns out they are dependent on me staying here and helping with my share of costs.

So I'm just rambling here and worrying can I get by on the $1880 a month now, a year and half before I thought I would have to? I am good at stretching a dollar and paying myself first, so I think I CAN do it, I just don't know if it will be enough. My Cobra ends in Dec and the NYS Healthcare plans, the cheapest one had a 5k deductible and did not take all my doctors. So I am going to push to get as much testing and anything expensive done before Dec. IDK, if I didn't have health issues this would not be a problem, I could live on that easily. Of course, I wouldn't have to because I'd be working!

I can touch my retirement money now that I have SSDI. But that is the absolute last thing I would ever do, it would have to be a catastrophic emergency.

Because I moved my entire 401k over to Vanguard with my other IRAs, I am entitled to another free session with a CFP. The last one was great and I did speak briefly to him again when I first went out on disability and he said I have enough to take out to be able to live on but not touch the principle ever. I think it's time for me to use that free session and presume I am going to get nothing more from LTD and plan for not having it. Does that seem prudent?

oh how I wish my memory and neuro issues would just disappear and I could have my job and my life back. Ok, done complaining.

[Teacher Terry]

So very sorry that they are jerking you around so much. YOu may have to get a disability lawyer. Ugh! You have had a major string of bad luck in many areas. Hugs:))

[early morning]

freshstart, I am so sorry you're dealing with all this crap. You do NOT have to pay taxes on the disability money that was returned. DH had the same issue. It didn't help that the check was cut in one tax year but we did not actually receive it and could not and pay back the disability insurance company until the next tax year. We just went to a CPA who did tax prep and was knowledgeable about disability. It was not hard to find someone, and we live in a pretty rural area.

Long term disability ins. can be a PITA - I can empathize. Can we bitch about specific companies? I'm guessing not, so - I have my LTD with the duck, had one claim, they were awesome and bent over backwards to help. DH has the 4-letter word with two u's in it. They were not very helpful when he first went on disability, made us apply for SSDI before DH was ready to do so, sent HUGE amounts of paperwork to all of his doc's in the hope that one of them would not say he was totally disabled, or would just not fill it all out. They asked the same questions reworded about 6 times in the same questionnaire, hopping to trip us up (they didn't), called and sent forms frequently, called in an "expert" who looked at the paperwork and said DH could do any job out there as long as he could change position often, not bend, pick anything up, lift anything, do anything repetitive, sit or stand for more than 10 minutes per hour- and that there were "plenty" of jobs where those conditions could easily be met. And those jobs would be???? All I could think of was Mattress Tester, and Lil' Abner already has that one!

I think your plan to talk to a CFP and maybe set up payments from your IRA is a good one. I think you'll feel better knowing where you stand. And if you DO get more in disability ins. you can stick it right into your E-fund. And ask him/her for a summary of what you were told, in writing. I can't remember half of that stuff....

Hugs and best wishes!

[freshstart]

you're the first person to even understand what I ineptly was trying to say about the taxes, you've given me hope!

My LTD is *igna, they are so bad that my case manager employed by them told me to expect to never receive it, so he was shocked when I did. I got sent to so many of their docs it was crazy, they paper bombed my docs but they paper bombed them right back because they were all in complete agreement that I was disabled. Their guy who retested my IQ, memory, concentration, all that stuff would take my paper and tell me to correct my answers! I was shocked! At the end, I said, "well, at least we'll find out your IQ," lol.

I knew they sucked but I fell for that standard line that they tend to pay for 2 years, I should've realized that was probably BS, too. At the time of the job evaluation, I was still on bedrest from having an inaudible BP, I'd stand and faceplant. I had to go but face planted after a few minutes when there was no where to sit in the waiting room so they didn't push me too hard on what I could do. There aren't many jobs you can do from the floor, although I'm sure they tried to think of something, floor polisher perhaps.

this will all work out the way it's supposed to, and however it goes, I will be ok. No one will let me starve, I'm lucky to have family. I can't imagine having gone through the last year and a half alone. I hope you and your DH are ok.