Usually hiring a lawyer is expensive. Fortunately for those that qualify for Social Security disability, if you hire a lawyer to help you with an initial application or appeal, you will only pay a lawyer’s fee if you win your case. That contingent fee is supposed to be paid by Social Security out of your back benefits. Under most circumstances, the lawyer’s fee will be paid directly from Social Security to your lawyer and not out of your pocket.
Usually, a Social Security lawyer’s fee is paid directly by Social Security. In other words, you could get a free Social Security disability lawyer
When your claim is successful, Social Security will withhold 25% of your back benefits to pay the lawyer’s fee. Under most circumstances, your lawyer’s fee will be 25% of your back benefits up to $6,000. (That fee can be greater if you lose your hearing and require more appeals.)
If Social Security doesn’t withhold enough, you could be on the hook.
One exception to the general rule that you won’t have to pay your attorney fee out of your own pocket is if Social Security fails to withhold enough from your back benefits to pay your lawyer their full fee. In those situations, you can be on the hook for paying your lawyer part of their fee. So, before you spend the check for your back benefits, check with your attorney to confirm they have been paid.
Social Security disability lawyer fees: Look out for the repayment of costs.
One payment you may need to make to your Social Security disability lawyer is to repay them for costs. Technically this is not a fee, but if there is a requirement to repay costs it should be in the agreement that you sign with your lawyer. Lawyers often advance costs to pay for medical records, filing fees, and sometimes for medical expenses. If you win your case, you may need to pay those back to your lawyer directly as they are typically not paid by Social Security.
Fees for federal court.
Most cases are resolved by the time an administrative law judge comes back with an order from your hearing. However, some claimants will have to continue their appeals all the way to federal court. If your case is one that ends up in federal court, how your lawyer’s fees are calculated and how they’re paid might change a little bit. Some of the lawyer’s fee may get paid directly by Social Security out of their own funds to your lawyer - at no cost to you.
When a case is appealed to federal court, your attorney fee might change from 25% to 50% of the back benefits. This is because the amount of work goes up with an appeal to federal court. However, some of that increase sometimes has to be paid by the Social Security Administration. When you win in federal court you can often ask for Social Security to pay your lawyer an hourly rate for their federal court work. These are called EAJA fees for the Equal Access to Justice Act that authorizes the fee award. The good news about these fees is that to the extent they are awarded and paid to your lawyer (1) they are paid by Social Security and do not come out of your pocket; and (2) they reduce what must be paid out of your back benefits if you win your claim.
Need an SSDI lawyer?
Disability Alabama helps Social Security disability claimants with applications, with disability hearings, with federal appeals, and even disability cessation cases. If you need help with your Alabama disability case, give Disability Alabama a call.