A Free Guide to Social Security Disability Insurance and Supplemental Security Income Disability Benefits
Work Incentives For People Receiving Social Security and Supplemental Security Income Disability Benefits
By R. M. Bottger
SSA has a number of incentives to encourage people who are receiving disability benefits to work. If you are already receiving benefits, here is what SSA will do to help you go back to work.
If you are receiving disability benefits, you probably already know the difference between Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) disability benefits. However, I am going to briefly review the difference just in case. To be eligible for SSDI, you must have paid into Social Security 20 of the last 40 quarters (unless you are blind, in which case the rules are more lenient). For SSDI, you must be earning last than $780 per month. There are no limits on unearned income and resources. You can have a million dollars in the bank and still receive SSDI benefits as long as you are not working for more than $780 per month. SSI, on the other hand, is a need-based program. To receive SSI, you donít have to have paid into Social Security. To receive SSI disability benefits, you must have below a certain level of income and resources (this includes your spouses resources).
In order to receive SSDI and/or SSI disability benefits, you cannot be engaging in substantial gainful activity (SGA). If you earn more than $780 per month, you are engaging in SGA. While you are receiving disability benefits, all earnings regardless of the amount must be reported to SSA. If you are earning less than $780 per month, your earnings will not affect your SSDI benefits. Your earnings will count toward your income and resources for the purposes of calculating the size of your SSI benefits. Earnings may cause a decrease in the size of your SSI payments or even cause you to no longer qualify for SSI due to excess income and resources.
Impairment Related Work Expenses (IRWE)
When deciding whether you are engaging in SGA, SSA deducts the amount of money you must spend on impairment related work expenses. Wheelchairs, special transportation, or special equipment needed in order to work are examples of impairment related work expenses. SSA also deducts impairment related work expenses from your income and resources when calculating your SSI benefits. For example, if you earn $1,000 per month but spend $300 per month on special transportation due to your disability, then SSA would consider your earnings to be $700 per month, which is not SGA.
Subsidies and Special Conditions
"Subsidies" and "Special Conditions" refer to support you receive on the job that could result in your receiving more pay than the actual value of the services you performed. SSA looks at the actual real value of your work when deciding whether or not you are engaging in SGA. In other words, SSA deducts the amount of the subsidy from your actual earnings when deciding whether or not you are engaging in SGA. If you require extra help or supervision than other employees doing the same job for the same pay, this is a subsidy. Or, if you perform fewer or simpler tasks than other employees doing the same job for the same pay, then this is a subsidy. SSA does not, however, deduct the value of the subsidy or special condition from your earning when calculating your income and resources for the purpose of figuring your SSI benefits. Therefore, this amount can cause a decrease in the size of your SSI payment or cause you to cease to qualify for SSI.
Unincurred Business Expense
"Unincurred business expenses" refers to self-employment business support that someone provides to you at no cost. In deciding whether you are working at the SGA level, SSA deducts unincurred business expenses from your net earnings from self-employment. For example, if a Vocational rehabilitation agency gives you a computer that is used in a graphic arts business, then that is an unincurred business expense. Or if a friend works for your business as unpaid help, it is an unincurred business expense. To qualify as an unincurred business expense, the expense must be something the IRS would consider a legitimate business expense if you were to pay for it and someone else must have paid for it. SSA does not, however, deduct the amount of unincurred business expenses when calculating your income and resources for the purpose of calculating your SSI benefits.
Unsuccessful Work Attempt
An unsuccessful work attempt is an effort by a disabled individual to do substantial work that either stopped or produced earnings below the SGA level after 6 months or less because of the personís disability or because special services or conditions that the person needed to work have ended. The amount earned during an unsuccessful work attempt does count toward your income and resources for the purpose of calculating your SSI benefits.
Continued Payment Under a Vocational Rehabilitation Program
If SSA decides that you are no longer disabled, your monthly benefits can continue as long as your are actively participating in an approved Vocational Rehabilitation program that is expected to help you become self-supporting.
Trial Work Period (TWP)
A TWP allows you to test your ability to work. You can earn SGA for up to 9 months and still receive your full SSDI payment. The 9 months do not need to be consecutive. Your trial work period will last until you accumulate 9 months of work during the past 60 months. Your case will not be reviewed just because you are working, but your regularly scheduled review may occur during this time period. All cases are required to be reviewed to make sure the person is still medically disabled. If it is found that you are no longer medically disabled, then your TWP will end and your benefits will cease. During your medical review, SSA may contact your employer about your ability to work. Once you have successfully completed the trial work period, your monthly benefit payment will cease.
Extended Period of Eligibility (EPE)
After you successfully complete your trial work period, your monthly benefit payments will cease. For the 36 consecutive months after you complete your trial work period, any time your earnings drop below the SGA level, you can contact your local SSA office and your benefits will be reinstated without your having to file a new application for disability benefits. Your case will not be reviewed just because you are working, but your regularly scheduled review may occur during this time period. All cases are required to be reviewed to make sure the person is still medically disabled. If it is found that you are no longer medically disabled, then your EPE will end. During your medical review, SSA may contact your employer about your ability to work. The EPE applies only to SSDI benefits; it does not apply to SSI benefits.
Blind Work Expenses
Many of the rules regarding disability benefits are different for blind individuals. When SSA is looking at a personís income to determine SSI eligibility and benefits amount, it does not count any earned income that is used to meet the expenses of working. The expenses do not need to be disability related. Any work expense such as income taxes, meals consumed during working hours, transportation to and from work, and guide dog expenses are deducted from the amount the blind individual is earning. For non-blind people, work related expenses must be disability related to be exclude when calculating SSI eligibility and benefit amount.
Plan for Achieving Self-Support (PASS)
A PASS that has been approved by SSA allows you to use your income and resources to reach a work goal. A PASS might, for example, include using your resources to obtain education or start a business. Your goal should be a job that earns enough money for you to be self-supporting. Money used to meet the goals in your SSA approved PASS does not count when SSA is figuring your income and resources for SSI eligibility and benefit amount. Therefore, a PASS may help you qualify for SSI or increase the amount of your monthly SSI payment.
Property Essential to Self-Support
When SSA is calculating your income and resources to determine if you are eligible for SSI benefits, they do not count the value of property that you use to be self-supporting. This could include things such as tools, equipment, and inventory.
Continued Medicare Coverage
Once you are found to be disabled, there is a two year waiting period before you are eligible for Medicare; you must complete this waiting period before any Medicare coverage can begin. Once your trial work period is over and your monthly cash benefit payment has stopped, you are eligible for 93 months of continued Medicare coverage. You do not pay anything for the hospital coverage; you may buy Part B coverage. You must work and earn SGA, but your medical condition must not be improved. The only time that you would get less than the 93 months is if some of the months after you complete your trial work period are still part of your 2 year waiting period. Once your 93 months of premium-free hospital coverage cease, you may buy the hospital coverage as long as you remain medically disabled.
Continued Medicaid Eligibility
Your Medicaid may continue once you go back to work even if your income and resources are too high to continue to receive monthly SSI cash payments. You must need the Medicaid in order to continue to work and you must meet certain earnings restrictions.
Reinstating Eligibility Without a New Application
If your SSI disability benefits cease due to excess income and resources, you may have your benefits reinstated if your earnings and resources drop back below the required level without filing a new application up to 12 months after your benefits ceased .
Student Earned Income Exclusion
To qualify for the student earned income exclusion, you must be under age 22, not married, and not head of a household, and be regularly attending school. If you meet these requirements, SSA will not count the first $1,320 that you earn each month when calculating your eligibility for SSI and the size of your SSI benefit payments. The maximum yearly exclusion is $5,340. These dollar amounts are for the year 2002; the amounts are adjusted yearly.
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All material on this site Copyright 2002-2003 by R. M. Bottger