Introduction
Can you work while you apply for or receive Social Security disability benefits? In some cases, yes. In this article, we will explain how you can work while you receive SSDI and SSI benefits.
First Off, Understand Substantial Gainful Activity (SGA)
What Is Substantial Gainful Activity?
Substantial gainful activity is work that involves significant and productive duties and pays more than a current monthly income limit set by the Social Security Administration. SSA applies a specific test to determine whether your work activity is both substantial and gainful.
What Is Substantial Activity?
Work activity is “substantial” if it involves significant physical activity, mental activity, or both. The amount of hours you work in a week does not necessarily determine whether the work is substantial gainful activity. Full-time or part-time work can be a substantial activity, as long as the income from the work is over a certain amount per month. Any work you do for an employer or in self-employment can also be a “substantial” work activity.
The SSA only considers the amount of income you receive from actual work performed. This amount does not include money from non-work-related sources, such as gifts or interest. Passive income, such as that from investments or retirement funds is also not considered substantial gainful activity.
What Is Gainful Activity?
If you are earning more than a certain amount of income per month, then you are engaged in substantial gainful activity. The SSA uses earning guidelines to evaluate whether your work activity is at a substantial gainful activity level. These guidelines can change each year. In 2022, the SGA amount for non-blind individuals is $1,350. If you are working and earning more than $1,350 per month this year, you may be ineligible for SSDI or SSI benefits. You can find each year’s guidelines on SSA’s website here.
In determining whether a self-employed individual is working at a substantial gainful activity level, consideration is given to the individual’s work activities and the value of their business. Self-employment income alone is not a reliable factor in determining substantial gainful activity. If you do own your own business, the Social Security Administration allows you to deduct normal business income and other impairment-related work expenses
Working While Receiving SSDI Benefits
Are There Any Exceptions?
Is it possible to work while receiving SSDI benefits? In some cases, yes. If you lose your case because you are working at the substantial gainful activity level, an experienced lawyer would know how to appeal your case and possibly win at the next appeals level.
If you are working and earning more than $1,350 per month, you may still be eligible for SSDI or SSI benefits. The Social Security Administration encourages people to attempt to return to work. You will not be penalized for that attempt if you meet the criteria of a few exceptions including an “unsuccessful work attempt” and the “trial work period.”
Unsuccessful Work Attempt
If you are applying for benefits and have worked at a substantial gainful activity level, you may still be eligible for benefits if your work attempt was unsuccessful. An unsuccessful work attempt is an attempt to go back to work that fails within six months of your return to work due to your disability.
To have an unsuccessful work attempt, there must be a “significant break” between the time you initially stopped working due to your disability and the work attempt. This means that you stopped work activity due to your disability and were out of work for at least 30 consecutive days. Your work attempt will be “unsuccessful” if you have to stop work again within six months of your return. If the work attempt lasts more than six months, you will not be eligible for an unsuccessful work attempt.
If you returned to work, worked less than six months at the substantial gainful activity level, and had to stop working again because you could not perform your work due to your disability, you may still be eligible for SSDI or SSI benefits.
Trial Work Period
After you become eligible for SSDI benefits, you may return to the workforce and work at a substantial gainful activity level, and continue to receive benefits while working on a trial work period. During the trial work period, all people who get SSDI benefits can work for any nine months within a five-year window without losing benefits. You can work and earn any level of income while still keeping your SSDI benefits.
The Social Security Administration counts a calendar month toward your nine months of a trial work period if you earn more than a certain amount. Each year, the SSA issues guidelines on the amounts that count toward a trial work month. In 2022, a trial work period occurs any time you work and earn more than $970 before taxes. You can find each year’s guidelines on SSA’s website here.
The nine months of a trial work period don’t have to be consecutive. And you do not have to enroll in the Trial Work Period program. The Social Security Administration will track your work and earnings when you report your wages or self-employment activity.
The Trial Work Period ends once you accumulate nine months of work within a five-year window. If you do not continue to work, you will continue to be eligible for SSDI benefits. If you do not complete all nine months of the trial work period within the five-year window, you may be entitled to a new trial work period.
Extended Period of Eligibility
Once you complete your Trial Work Period, you will enter into a 36-month period called the Extended Period of Eligibility. After completing the trial work period, the Social Security Administration will determine if you are doing any substantial gainful activity. If you are working at a substantial gainful level, your SSDI benefits may end.
The Extended Period of Eligibility is a 36-month period. During the 36 consecutive months after the trial work period, your SSDI eligibility is determined on a month-to-month basis. If you make over the substantial gainful activity amount, you will not receive your monthly benefit. If you don’t make over the substantial gainful activity amount in a particular month, you can still get your SSDI monthly benefit.
Working While Receiving SSI Benefits
Is it possible to work while receiving SSI benefits? In some cases, you can work while you receive SSI benefits. The Social Security Administration will determine whether or not you are working at a substantial gainful activity level. If you are working below the level, you are still eligible for benefits. But SSI recipients should know that their earnings may affect the amount of SSI benefits they receive each month.
All earned income must be reported to the Social Security Administration. You are required to report your gross income. Once you report your earnings, your income will be deducted from your monthly SSI benefits. In 2022, the SSA will pay up to $831 per month for an eligible individual and $1,261 per month for an eligible couple. Your monthly SSI benefit is the difference between this monthly maximum and your countable income. Wages from a job are included as countable income.
Each month, the Social Security Administration will disregard the first $65 you earn plus one-half of your earnings and then deduct the remaining earnings from your SSI benefits. If you earn $65 or less in a given month from wages, SSA will not deduct any money from your monthly benefit.
Remember, if you are engaged in substantial gainful activity, the Social Security Administration may terminate your SSI benefits.
Conclusion
To be eligible for SSDI or SSI benefits, you must be unable to engage in any substantial gainful activity. Substantial gainful activity is earnings you receive from any work you do. The Social Security Administration (SSA) will look to see if you are working at a substantial gainful level. If you are performing work at a substantial gainful activity level, you will be ineligible for SSDI or SSI benefits, no matter what health problems you have.
The substantial gainful activity rules and their exceptions can be complicated. If you are working while applying for benefits and have questions about your claim, contact our office for a free consultation. Having an experienced lawyer is important for presenting your disability case properly to the Social Security Administration. Our representatives have a history of success winning benefits for our clients while they continue to work.
Frequently Asked Questions
Will I lose my Social Security disability if I work?
Special rules make it possible for people to work and still receive Social Security disability benefits. In order to work, you’ll need to keep track of how much money you make each month. You will still be eligible for Social Security disability benefits as long as you are not engaged in “substantial gainful activity.”
How much can I earn while on disability?
Substantial gainful activity is work that brings in over a certain dollar amount per month. In 2022, the substantial gainful activity amount was $1,350 per month. In 2022, as long as you continue to meet Social Security’s definition of disability, if you are earning less than $1,350 per month, you will be allowed to collect your disability benefits.
How many hours can I work?
Social Security’s rules focus on the amount of money you make a month, not the number of hours you work. As long as you make under the substantial gainful activity level, you can still receive your disability benefits.
Are there any exceptions to these rules?
There are exceptions to these rules. If your medical condition improves and you want to try to go back to work making more than $1,350 per month, you can try out a “trial work period” for a certain number of months.
A trial work period allows people to test their ability to work while they continue to receive their disability benefits, regardless of how much money they make a month. You can continue to receive your full benefit amount as long as you report your work activity to Social Security and continue to meet their rules for disability.
For 2022, any month where you earn more than $970 will be considered a “trial work month.” Your trial work period can continue until you’ve worked nine months within a 60-month timeframe. At the end of the trial work period, you can still receive disability benefits for any month that you did not make more than the substantial gainful activity amount.
Does the SSA evaluate the work-ability even when the wages are low?
If you are working in any capacity, the Social Security Administration will first determine if you are working at a substantial gainful activity level. If you are not working at the substantial gainful activity level, you will still be eligible for SSDI or SSI benefits. But the SSA can review your work activity as a factor in determining whether or not you are disabled. An examiner may deny your case if they believe you can work on a full-time basis at a substantial gainful activity level despite your disability.
How beneficial is it to hire a disability lawyer?
A Social Security disability attorney is an advocate who helps their client navigate the disability process from the initial application through the subsequent appeals. A trained attorney knows how to gather, organize, and submit the proper medical evidence, submit the appropriate paperwork and appeals, and speak to the Social Security Administration on their client’s behalf. If denied, the disability attorney will make legal arguments at the initial appeals level and prepare and present the case in front of an Administrative Law Judge at a disability hearing.
Research shows that having a representative will increase your chances of winning your disability claim. Representatives can increase the probability of winning your claim at the application stage and thus, reduce the total case processing time.
At LaPorte Law Firm, our attorneys specialize in solely Social Security Disability law. We have over 40 years of experience working with claimants at every stage of the disability claim process.
How do the Social Security benefits change during/after retirement?
Social Security disability benefits provide monetary and medical benefits to those who are too ill or injured to work but too young to retire. Once you reach your full retirement age, you will no longer be eligible for SSDI benefits. Instead, the Social Security Administration will pay you your Social Security retirement benefit. Your retirement benefit will not be less than your disability payment.
No action is required to transition from your disability benefit to your retirement benefit. The Social Security Administration will automatically convert your benefit once you hit full retirement age. To find your full retirement age, visit SSA’s website here.
Can I work while waiting for a decision on my Social Security Disability claim?
Yes, in some cases you can still work while you apply for disability benefits and go on to win your claim. If you are working and not engaged in substantial gainful activity, then you are still eligible for benefits. If you are working and the Social Security Administration determines that you are engaged in substantial gainful activity, they may deny your claim. If you think the SSA wrongly denied your claim, contact LaPorte Law Firm for a free consultation.
Can I withdraw from my 401(k) while on SSDI? Would such a withdrawal be taxed?
You may withdraw from your 401(k) while you apply for or are receiving your SSDI benefits. The 401(k) withdrawal will not affect your eligibility for SSDI benefits, nor will it affect your ongoing eligibility or monthly benefits. Because 401(k) money is considered passive income, any withdrawal you make will not be considered work at a substantial gainful activity level.
While withdrawing from your 401(k) won’t impact your SSDI, withdrawals are considered taxable income. You may pay more in taxes because the money withdrawn counts as taxable income.
What expenses can be deducted from earnings?
When looking at your work earnings in deciding if you have done substantial gainful activity, the Social Security Administration will subtract reasonable costs of certain items and services you need and use to enable you to work. These are called impairment-related work expenses. Examples of impairment-related work expenses include the cost of medical devices, service animals, or paying someone to help you at work. Anything that you can demonstrate as necessary for getting you to and from work or that helps you complete your work duties can be declared as an impairment-related work expense.
When reporting your income, the Social Security Administration allows you to deduct all impairment-related work expenses. The amount paid to cover impairment-related work expenses is not counted against you when determining if you are working at a substantial gainful level.
