Monday, December 29, 2014

Repercussions of the Binder & Binder Bankruptcy

Binder & Binder one of the Nation's largest, and probably the best known, Social Security Disability law firms has filed for bankruptcy.  The firm became known for their tacky T.V. commercials showing attorney Charles Binder wearing a cowboy hat.

The firm's slogan: "We'll deal with the government.  You have enough to worry about."  is well known by those who spend a good part of the day watching day-time television.  Binder & Binder spends approximately $20 million a year in advertising alone.

Now, it is widely rumored that Binder & Binder is pulling all their T.V. ads off the air.  Binder has also announced that it will be closing offices in several cities through out the nation, including Hartford, in an effort to reduce costs.

Over the past two to three years, Binder's exorbitant budget and heavy caseload was used by the critics of the Social Security Disability programs to wrongly allege that the system was being overly generous to claimants.  Such criticism lacked basis.  In fact, Social Security Disability Law Firms have always had to work with a very small margin of profit.  Binder & Binder's bankruptcy debunks the wrong notion the lawyers are getting rich out of the Social Security Trust Fund.  Moreover, all well informed disability lawyers have known that the boom in SSDI applications has been over for quite some time.  (The boom probably occurred from 2010 to 2011.)  As I have explained in previous posts, the boom was the result of the Nation's demographics, not of a system that was overly generous to claimants.  Unfortunately, lousy politicians in Washington don't want to do a serious analysis of Social Security's problems.  They act as if the Nation's demographics had not changed.  Instead, they find it easier to play the blame game and portray disability lawyers as the cause of the crisis.     

Monday, December 15, 2014

Fraudulent Tax Preparers and Social Security Disability

Lately, I have seen a lot of Social Security Disability claimants get in trouble because they have reported self employment income to the IRS in order to receive a refund under the Earned Income Tax Credit. Unfortunately, in many instances, the claimant never really had any self employment income and the only purpose for falsely reporting this income was to get a refund.  Beware! Those who engage in this practice are committing tax fraud!  
In addition, falsely reporting self employment income will kill your chances of winning your Social Security Disability case.  A person who is self employed will, in all likelihood, be found not to be disabled.  Moreover, a person who has made a fraudulent tax return, is not going to be believed at all by a judge.  If a claimant lied in his tax return, why wouldn't he or she also lie in her SSD application? 
Through out the entire Social Security Disability process, is always good to keep in mind the fact that Uncle Sam knows a lot more about you than you think.  Please remember that, you can't get away with telling one thing to the IRS and then telling something else to the SSA.
I suspect that tax preparers are largely responsible for the large number of fraudulent tax returns seeking an earned income tax credit.  The tax preparers that we frequently see aggressively advertising in the inner city, solicit low income people and lead them to believe that there will be no consequences to filing a false tax return.  In many instances, they convince disabled individuals who have been waiting for a long time for their Social Security Disability hearing and are desperate for money.  This is truly unfortunate.  More needs to be done to educate the public, --particularly those who are disabled--, about the consequences of falsely reporting income in order to get a refund.  It would also be ideal if the government took a more aggressive stand in investigating the corrupt practices of tax preparers who induce low income individuals to engage in this practice.    

Monday, December 8, 2014

Nazis Can't Collect Social Security... Anymore

Did you know that, Jakob Denzinger, a 90 year former Auschwitz guard who later became an American citizen, collects approximately $1,500 per month in Social Security payments. Denzinger has renounced his American citizenship and no longer lives in the U.S.  However, he still gets his monthly check.
After it was discovered this past October that dozens of Nazis who have been forced out of the United States are still collecting Social Security, Congress unanimously passed a bill a few weeks ago terminating benefits for these war criminals. 
Even though these Nazis had lost their U.S. Citizenship, under current law benefits can not be stopped.  In order to be able to stop benefits, a higher threshold is required: there must be a final order of deportation against the Social Security recipient.  Now, if the bill passed by Congress becomes law, benefits would be stopped immediately.
According to Forbes magazine, Social Security payments to Nazis could have reached millions.  It is estimated that as of 1999 at least $1.5 million in benefits had been paid.  The lighter side of this story is that at least members of Congress were finally able to unanimously agree on a piece of legislation related to Social Security.      
Since we all need some humor to get through the Social Security Disability process, here is a report from Stephen Colbert on this subject: