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How Much Money Am I Allowed to Make on Disability? Navigating the Complexities of Income Limits

The seemingly simple question of how much you can earn while receiving disability benefits quickly unveils a labyrinth of regulations and program nuances. The straightforward answer is: it depends. It hinges entirely on the specific disability program you’re receiving benefits from: Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI). These two federal programs, while both administered by the Social Security Administration (SSA), have very different eligibility requirements and, crucially, different income limitations. Understanding these distinctions is paramount to maintaining your eligibility and avoiding overpayments. Let’s break it down.

For SSDI, the focus is on your ability to engage in substantial gainful activity (SGA). In 2024, the SGA limit is $1,550 per month. This is the general benchmark for what the SSA considers “working.” Earning above this amount typically signifies that you are no longer considered disabled under SSDI rules, and your benefits could be terminated. However, this isn’t a hard and fast rule, and there are some exceptions we’ll delve into. Importantly, this limit applies to gross earnings, before taxes and other deductions.

For SSI, the income restrictions are significantly tighter. SSI is a needs-based program, meaning it’s designed to help individuals with limited income and resources. In 2024, the federal SSI benefit rate is $943 per month for an individual. However, this doesn’t mean you can earn $943 and still receive the full SSI benefit. The SSA considers virtually all income when determining your SSI payment amount, and they have specific rules about what counts as income. The SSA reduces your SSI payment based on most other income you receive. This makes it very difficult to work while receiving SSI and still maintain full benefits.

SSDI Income Limits: Substantial Gainful Activity and Beyond

Understanding Substantial Gainful Activity (SGA)

The SGA threshold is the central concept to grasp when navigating SSDI income limits. It represents the SSA’s determination of whether you can perform significant work and earn a sustainable income. As previously stated, in 2024, this amount is $1,550 per month for non-blind individuals. For blind individuals, the SGA amount is higher at $2,590 per month in 2024.

Several factors contribute to the SGA determination. The SSA considers not just your earnings, but also the nature of your work. Are you performing simple, unskilled tasks, or complex, skilled work? Do you require special accommodations or assistance to perform your job? These factors can influence the SSA’s assessment of your ability to engage in SGA, even if your earnings are slightly above the threshold.

Trial Work Period (TWP)

The Trial Work Period (TWP) is a valuable safeguard for SSDI recipients who want to test their ability to work without immediately jeopardizing their benefits. This period allows you to work and earn without losing your SSDI benefits for up to nine months within a 60-month period.

In 2024, a month counts as a Trial Work Period month if your earnings exceed $1,110, or if you work more than 80 hours in self-employment. During the TWP, you continue to receive your full SSDI benefits, regardless of how much you earn (provided you meet the TWP earnings or hours requirements).

Extended Period of Eligibility (EPE)

Following the TWP, you enter the Extended Period of Eligibility (EPE), which lasts for 36 months. During this period, if your earnings exceed the SGA level ($1,550 in 2024), your SSDI benefits will generally be suspended for that month. However, if your earnings fall below the SGA level in a subsequent month, your benefits can be reinstated without having to reapply. This provides a safety net and allows for fluctuations in your work activity due to your disability.

Unsuccessful Work Attempt (UWA)

An Unsuccessful Work Attempt (UWA) allows you to continue receiving benefits if you attempt to return to work, but are ultimately unable to sustain it due to your medical condition. The SSA may disregard your earnings from the UWA when determining if you are performing SGA. To qualify, the work attempt must have ended within six months due to your disability, and you must have had to stop working or reduce your work below SGA level.

SSI Income Limits: A More Stringent Standard

Understanding Countable Income

Unlike SSDI, which primarily focuses on SGA, SSI assesses your countable income. This includes nearly all sources of income, such as wages, Social Security benefits (including SSDI), pensions, unemployment benefits, and even certain in-kind support and maintenance (ISM).

The SSA deducts certain exclusions from your total income to arrive at your countable income. These exclusions include:

The first $20 of most income received in a month.
$65 of earned income received in a month.
One-half of earned income above $65.

The Impact on Your SSI Benefit

After applying these exclusions, the resulting “countable income” is subtracted from the federal SSI benefit rate ($943 in 2024) to determine your actual SSI payment amount. This means that even a small amount of income can significantly reduce your SSI benefit. For instance, if you earn $200 in a month, your countable income would be calculated as follows:

$200 (earnings) – $65 (exclusion) = $135

$135 / 2 = $67.50

$20 (General Income Exclusion) is applied from another income source or from the unearned portion of the earned income.

Therefore the countable income for calculating your SSI payment would be $67.50. Your SSI payment would be reduced by this amount: $943 – $67.50 = $875.50.

Reporting Requirements

It is absolutely critical to report any changes in your income to the SSA promptly and accurately. Failure to do so can result in overpayments, which you will be required to repay. The SSA has various ways to report income, including online portals, telephone, and in-person visits to local SSA offices.

Frequently Asked Questions (FAQs)

Here are 12 frequently asked questions to further clarify the complexities of income limits while on disability benefits:

What happens if I earn more than the SGA limit on SSDI?
Generally, if you consistently earn above the SGA limit, the SSA may determine that you are no longer disabled and terminate your benefits. However, the TWP and EPE provide opportunities to work without immediate loss of benefits. It’s crucial to report your earnings and understand how these work incentives apply to your situation.
Does all income count towards the SSI income limit?
No, not all income counts. The SSA applies specific exclusions, such as the $20 general income exclusion and the $65 earned income exclusion, before determining your countable income. Additionally, certain types of income, like food stamps, are excluded.
What is “in-kind support and maintenance” (ISM) and how does it affect SSI?
ISM refers to non-cash assistance you receive that covers your basic needs, such as food, shelter, or clothing. The SSA may reduce your SSI benefit if you receive ISM, as it reduces your financial need. The SSA will apply the “one-third reduction rule”, or value the ISM, depending on the situation.
Are there work incentives available for SSI recipients?
Yes, SSI has numerous work incentives. The PASS (Plan to Achieve Self-Support) is one popular incentive. This allows you to set aside income and resources to achieve a specific work goal, such as starting a business or obtaining job training. The money you set aside in the PASS does not count toward the SSI income or resource limits.
How does self-employment income affect my disability benefits?
For SSDI, self-employment income is assessed using the SGA guidelines. The SSA looks at your net earnings and the value of your services. For SSI, self-employment income is treated similarly to wages, but the SSA may also consider business expenses when calculating your countable income.
If my SSDI benefits are terminated due to earnings, can I get them back?
Yes, under certain circumstances. If your benefits were terminated due to your ability to engage in SGA, and your medical condition worsens within five years, you may be able to have your benefits reinstated without filing a new application through Expedited Reinstatement (EXR).
What if I disagree with the SSA’s decision regarding my disability benefits and earnings?
You have the right to appeal any decision made by the SSA. The appeals process involves several stages, including reconsideration, a hearing before an administrative law judge, and further appeals to the Appeals Council and federal court.
Does spousal income affect my SSDI benefits?
No, spousal income does not directly affect your SSDI benefits. SSDI is based on your own work history and earnings record.
Does spousal income affect my SSI benefits?
Yes, spousal income can affect your SSI benefits. The SSA considers a portion of your spouse’s income when determining your eligibility and payment amount, under a process called “deeming.”
Are there resources available to help me understand disability benefits and work incentives?
Yes, several resources are available. The SSA offers publications, online tools, and workshops to help beneficiaries understand their rights and responsibilities. State Vocational Rehabilitation agencies and other disability organizations can also provide assistance and guidance.
How do I report my earnings to the Social Security Administration?
You can report your earnings to the SSA online through your “my Social Security” account, by phone, or in person at your local Social Security office. Keep accurate records of your earnings and report any changes promptly.
What are impairment-related work expenses (IRWEs) and how do they affect SSDI?
Impairment-Related Work Expenses (IRWEs) are certain expenses related to your impairment that enable you to work. If you have IRWEs that you pay for, these expenses can be deducted from your gross monthly earnings when the SSA determines if you are engaging in SGA.