Can I Make Money While on Disability?

Individuals receiving Social Security disability benefits often wonder if they can earn income without jeopardizing their financial support. The Social Security Administration (SSA) administers two primary disability programs, Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI), both allowing beneficiaries to work under specific conditions.

Understanding Disability Benefits and Earnings

The Social Security Administration manages two distinct programs providing financial assistance to individuals with disabilities. Social Security Disability Insurance (SSDI) is for individuals who have worked and paid Social Security taxes, with eligibility based on past earnings. Supplemental Security Income (SSI) is a needs-based program providing financial support to aged, blind, or disabled individuals with limited income and resources, regardless of work history.

Substantial Gainful Activity (SGA) refers to a level of work activity that is significant and performed for pay or profit. The SSA uses SGA to determine if a disability prevents substantial work. For 2024, the SGA limit for non-blind individuals is $1,550 per month, and for blind individuals, it is $2,590 per month. These amounts are adjusted annually; for 2025, the non-blind SGA limit is $1,620 per month, and for blind individuals, it is $2,700 per month. Earning above these thresholds indicates the ability to engage in substantial work, which can affect benefit eligibility.

For SSI recipients, earned income operates differently. The program aims to supplement other income, not replace it. When an SSI beneficiary earns income, their benefit amount decreases, but not on a dollar-for-dollar basis. The SSA applies various income exclusions before calculating countable income that reduces the SSI payment. This system allows individuals to retain a portion of their earnings while still receiving some SSI support.

SSI considers both earned and unearned income, with different rules for each. Unearned income, such as Social Security benefits, pensions, or unemployment payments, reduces SSI benefits more directly than earned income. The SSA provides specific exclusions to encourage work and self-sufficiency, ensuring working does not immediately eliminate all benefit support.

SSDI Work Rules and Incentives

For individuals receiving Social Security Disability Insurance (SSDI), several work incentives support their return to employment without immediately losing benefits. One primary incentive is the Trial Work Period (TWP), which allows beneficiaries to test their ability to work for at least nine months. During this period, an individual can earn any amount of income without affecting their full SSDI cash benefits. The nine TWP months do not need to be consecutive but must occur within a rolling 60-month (five-year) period.

A month counts as a Trial Work Period month if gross earnings exceed a specific threshold. For 2024, this threshold is $1,110 per month. For 2025, this amount increases to $1,160. This allows a beneficiary to work and receive full SSDI payments, regardless of how much is earned, as long as work activity is reported.

Upon completion of the nine Trial Work Period months, beneficiaries enter an Extended Period of Eligibility (EPE), which lasts for 36 months. During the EPE, the SSA evaluates work and earnings based on the Substantial Gainful Activity (SGA) limits. If earnings in any month fall below the SGA level, the individual will receive their SSDI benefits for that month. If earnings exceed the SGA limit in any given month during the EPE, benefits are suspended for that month. The first month earnings exceed SGA after the TWP is considered a “cessation month.” Benefits continue for that month and the following two months, then stop if earnings remain above SGA.

Impairment-Related Work Expenses (IRWE) are another work incentive for SSDI beneficiaries. These are costs for items or services a person with a disability needs to work and that are directly related to their impairment. Examples include specialized transportation, certain medical devices, or attendant care services. When calculating whether a person’s earnings exceed the SGA limit, the SSA can deduct approved IRWEs from gross earnings. This deduction can help an individual’s countable earnings remain below the SGA threshold, preserving benefit eligibility.

Subsidies and special conditions in employment can also reduce countable earnings for SGA purposes. A subsidy occurs when an employer pays an individual more than the actual value of services performed due to the individual’s disability. Special conditions involve employer accommodations that allow a person to work despite their impairment, such as fewer duties or more supervision. The SSA assesses these situations to determine the true value of the work, and any portion of earnings attributable to a subsidy or special condition is not counted towards SGA. Work performed in a protected environment, such as a sheltered workshop, may not be considered SGA, allowing individuals to earn income while receiving support tailored to their abilities.

SSI Work Rules and Incentives

For individuals receiving Supplemental Security Income (SSI), specific work rules and incentives support employment and self-sufficiency. Unlike SSDI, SSI benefits are needs-based, and earned income directly impacts the monthly payment amount, though not dollar-for-dollar. The Social Security Administration applies various income exclusions when calculating countable income, which then determines the SSI benefit.

A primary exclusion is the general income exclusion, where the first $20 of most monthly income, whether earned or unearned, is not counted. Following this, a specific earned income exclusion applies: the first $65 of earned income each month is also excluded, along with one-half of the remaining earned income. For instance, if an individual earns $300 in a month, the first $20 is excluded, leaving $280. Then, the first $65 of the $280 earned income is excluded, leaving $215. Half of this remainder ($107.50) is then excluded, meaning only $107.50 of the initial $300 earned income is counted against the SSI benefit. This calculation ensures working individuals always retain more total income than those who do not work.

The Student Earned Income Exclusion (SEIE) is a significant incentive for young SSI recipients. This exclusion allows eligible students under age 22 who are regularly attending school to exclude a substantial portion of their earned income. For 2024, a student can exclude up to $2,290 per month, with a maximum yearly exclusion of $9,230. For 2025, these amounts are adjusted to $2,350 per month and $9,460 per year. This exclusion is applied before any other income exclusions, allowing students to earn income, develop work skills, and pursue education without significantly impacting their SSI benefits. Regular attendance means attending college at least 8 hours a week, or grades 7-12 or vocational training for at least 12 hours a week.

Blind Work Expenses (BWE) allow blind SSI recipients to deduct certain work-related expenses from their earned income. These expenses, which can include transportation to and from work, guide dog expenses, or professional association dues, are deducted from gross earned income when calculating countable income. This provision reduces the amount of income that counts against SSI benefits, effectively increasing the net financial gain from working for blind individuals. There are no specific monthly limits for BWEs; any legitimate work expense directly related to work due to blindness can be deducted.

The Plan to Achieve Self-Support (PASS) is a unique work incentive that allows blind or disabled individuals to set aside money and resources over a period to achieve a specific work goal. Funds set aside for a PASS are not counted when determining SSI eligibility or payment amounts. A work goal might involve education, vocational training, or starting a business. The plan must be in writing, approved by the SSA, and detail how the funds will be used to achieve the goal, fostering long-term self-sufficiency.

Section 1619(b) provides continued Medicaid eligibility for SSI recipients whose earned income becomes too high for them to receive a cash SSI payment. This provision is important because access to Medicaid coverage, which includes healthcare services, often exceeds the value of the cash SSI payment. To qualify for 1619(b), individuals must continue to meet the SSA’s disability requirements, have been eligible for an SSI cash payment for at least one month, and meet all other non-disability SSI requirements, such as resource limits. They must also need Medicaid benefits to continue working, and their gross annual earnings must be below a specific state-dependent threshold. This allows individuals to work and earn more, even if they lose their SSI cash benefit, while maintaining access to vital healthcare coverage.

Reporting Earnings and Maintaining Eligibility

Accurate and timely reporting of earnings to the Social Security Administration (SSA) is a strict requirement for all disability beneficiaries. This reporting is legally mandated to ensure benefits are paid correctly and to prevent potential overpayments, which can lead to significant financial burdens. Failure to report changes in work activity or income can result in penalties, including benefit suspension or the need to repay funds.

Beneficiaries should report gross earnings, the amount earned before any taxes or other deductions. For SSDI recipients, reporting work dates and employer details is important. For SSI recipients, reporting monthly wages is crucial due to the program’s income-sensitive nature. It is also important to notify the SSA of any impairment-related work expenses (IRWEs) or subsidies received, as these can affect how earned income is counted.

The SSA provides several methods for reporting earnings. The most convenient option for many is the online wage reporting tool available through the “my Social Security” account. This platform allows individuals to submit their gross monthly earnings electronically. Alternatively, earnings can be reported by mail, phone, or in person at a local Social Security office. For SSI recipients, some employers participate in electronic wage reporting, which may alleviate the need for direct reporting if the SSA already receives wage information.

The timing of reporting is critical to maintaining eligibility and avoiding issues. SSI beneficiaries are required to report their monthly wages by the 10th day of the month following the month in which the wages were earned. For example, earnings from May must be reported by June 10. For SSDI beneficiaries, reporting is required as soon as any change in work or income status occurs. This includes starting or stopping work, or any significant change in earnings.

Maintaining accurate records of all earnings, work dates, and reported information is a protective measure for beneficiaries. This documentation can be invaluable if questions arise regarding reported income or benefit calculations. Responding promptly to any requests for information from the SSA is also important. If uncertainties arise regarding reporting requirements or how work may affect benefits, beneficiaries should seek assistance from Work Incentives Specialists or contact their local SSA office for personalized guidance. Proactive and consistent reporting helps ensure continuous compliance and avoids potential financial complications.