How Much Money Can I Earn on SSDI?

The straightforward answer is: SSDI (Social Security Disability Insurance) doesn’t impose a strict earnings limit in the traditional sense, but it does have a system that encourages work while ensuring you’re truly unable to perform substantial gainful activity (SGA). Your SSDI benefit amount is based on your lifetime earnings record before you became disabled, not on your current income. However, exceeding a certain threshold of earnings can lead to a review of your disability status and potentially the termination of your benefits. This threshold is known as Substantial Gainful Activity (SGA).

In 2024, the SGA amount for non-blind individuals is $1,550 per month. For blind individuals, the SGA amount is higher, at $2,590 per month in 2024. Earnings above these amounts are generally considered evidence that you’re capable of performing substantial work.

Understanding the Intricacies of SSDI and Income

SSDI is designed to provide financial support to individuals who are unable to work due to a disability. It’s not a program that penalizes you for attempting to return to work, but it does need to ensure that it’s targeting its resources effectively. This is where the concept of SGA comes into play, and understanding how it works is crucial.

What Counts as Earnings?

It’s important to know what the Social Security Administration (SSA) considers “earnings.” This includes:

• Wages: Money you receive from an employer.
• Net Earnings from Self-Employment: Profit you make after deducting business expenses.
• In-Kind Income: Goods or services you receive instead of money, which can be valued and counted as income.

The SSA focuses on net earnings after certain deductions are made. For self-employed individuals, deducting business expenses is crucial for accurately calculating SGA. For employed individuals, certain impairment-related work expenses (IRWEs) can be deducted (more on that later).

Trial Work Period: Your Bridge Back to Employment

The SSA recognizes that returning to work after a disability can be a gradual process. That’s why they offer a Trial Work Period (TWP). During your TWP, you can test your ability to work without immediately jeopardizing your SSDI benefits.

Here’s how the TWP works:

• It lasts for nine months (not necessarily consecutive) within a rolling 60-month period.
• In 2024, a month counts as a TWP 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 your earnings, as long as you report your work activity to the SSA.

The TWP is an invaluable opportunity to experiment with different jobs or work schedules to see what you can realistically manage while maintaining your health.

Extended Period of Eligibility (EPE): Safety Net After the TWP

After the TWP, you enter an Extended Period of Eligibility (EPE), which lasts for 36 months. During the EPE, you can receive SSDI benefits for any month in which your earnings are below the SGA level. This provides a safety net as you transition back to work.

If your earnings go above the SGA level during the EPE, your benefits will cease after a grace period (typically two months). However, if your earnings drop below the SGA level again during the EPE, your benefits can be reinstated without having to reapply.

Impairment-Related Work Expenses (IRWEs): Deductible Costs

Impairment-Related Work Expenses (IRWEs) are unreimbursed costs you incur due to your disability that allow you to work. These expenses can be deducted from your gross earnings when determining if you are performing SGA.

Examples of IRWEs include:

• Medications or medical services necessary for you to work.
• Assistive devices or equipment (e.g., wheelchairs, hearing aids).
• Transportation costs related to your disability (e.g., specialized transportation).
• Service animals specifically required for work.

Properly documenting your IRWEs and providing this information to the SSA can significantly impact whether your earnings are considered above SGA.

Expedited Reinstatement (EXR): A Second Chance

If your SSDI benefits terminate because of your work activity and your earnings later drop below the SGA level due to your medical condition, you may be eligible for Expedited Reinstatement (EXR).

EXR allows you to receive temporary benefits (provisional benefits) for up to six months while the SSA reviews your application for reinstatement. This can provide crucial financial support while you are unable to work.

Frequently Asked Questions (FAQs)

1. How is my SSDI benefit amount calculated?

Your SSDI benefit amount is primarily based on your Average Indexed Monthly Earnings (AIME), which is a weighted average of your earnings over your working life. The SSA uses your AIME to calculate your Primary Insurance Amount (PIA), which is the basic benefit amount you are entitled to receive. The PIA is then adjusted based on factors like family benefits. It’s important to note that disability benefits are not based on the severity of your disability, but rather on your prior earnings history.

2. Can I work part-time while receiving SSDI?

Yes, you can work part-time. The crucial factor is whether your earnings exceed the SGA amount. The Trial Work Period and Extended Period of Eligibility are designed to support individuals who are attempting to return to work gradually. Remember to report all your work activity to the SSA.

3. What happens if I exceed the SGA limit?

If you exceed the SGA limit consistently after your Trial Work Period and during your Extended Period of Eligibility, the SSA will typically review your disability status. If they determine that you are no longer disabled, your SSDI benefits will be terminated, usually after a two-month grace period.

4. What is the difference between SSDI and SSI?

SSDI (Social Security Disability Insurance) is a benefits program for individuals who have worked and paid Social Security taxes. Eligibility is based on your work history and earnings record. SSI (Supplemental Security Income) is a needs-based program for individuals with limited income and resources, regardless of work history.

5. Can I deduct work-related expenses from my earnings?

Yes, you can deduct Impairment-Related Work Expenses (IRWEs) from your gross earnings. These are expenses that are directly related to your disability and are necessary for you to work. Ensure you keep detailed records of these expenses.

6. What if I am self-employed? How does SGA apply?

For self-employed individuals, the SGA determination is based on your net earnings from self-employment (NESE), which is your profit after deducting allowable business expenses. The SSA will also consider the value of any significant services you provide to your business. It is crucial to maintain accurate and detailed records of your income and expenses.

7. How do I report my work activity to the SSA?

You should report your work activity to the SSA as soon as possible. You can do this by calling the SSA’s toll-free number, visiting your local Social Security office, or reporting online if available. Be prepared to provide details about your earnings, hours worked, and job duties.

8. What happens if my medical condition worsens after my benefits are terminated due to work?

If your medical condition worsens and you are unable to continue working, you may be eligible for Expedited Reinstatement (EXR). This allows you to receive temporary benefits while the SSA reviews your application for reinstatement.

9. Can I appeal the SSA’s decision if they terminate my benefits?

Yes, you have the right to appeal the SSA’s decision if they terminate your benefits. You typically have 60 days from the date of the notice to file an appeal. It’s often beneficial to seek legal representation from a disability attorney or advocate during the appeals process.

10. Does receiving workers’ compensation affect my SSDI benefits?

Yes, receiving workers’ compensation can affect your SSDI benefits. The SSA may reduce your SSDI benefits if the combined amount of your SSDI benefits and workers’ compensation payments exceeds 80% of your average current earnings before you became disabled.

11. Can I receive unemployment benefits while receiving SSDI?

Generally, it is difficult to receive unemployment benefits while receiving SSDI, as receiving unemployment typically requires certifying that you are able and available to work, which may conflict with the requirements for SSDI eligibility. However, regulations may vary slightly by state, so it’s crucial to consult with your local unemployment office.

12. Where can I find more information and assistance with SSDI?

You can find more information and assistance with SSDI on the Social Security Administration’s website (ssa.gov). You can also contact your local Social Security office or consult with a disability attorney or advocate. Many non-profit organizations also provide valuable resources and support to individuals with disabilities.