Can You Make Money on Social Security Disability?

Individuals receiving Social Security Disability benefits can earn income. The Social Security Administration (SSA) provides guidelines for beneficiaries wishing to work. These guidelines offer opportunities to test their ability to return to the workforce without losing financial support. Understanding these regulations is important for combining disability benefits with earned income.

Understanding Earning Limits and Substantial Gainful Activity

The Social Security Administration uses Substantial Gainful Activity (SGA) to determine if a person’s work indicates an ability to perform significant work for pay or profit. SGA is central to deciding initial and continued disability benefit eligibility. Earnings exceeding the SGA limit suggest an ability to engage in substantial work, impacting benefit status.

For 2025, the monthly SGA limit is $1,620 for non-blind individuals and $2,700 for statutorily blind individuals. These figures adjust annually; beneficiaries should consult the SSA’s official website for current information. Earnings counting towards SGA typically include gross wages or net self-employment earnings.

When evaluating self-employment, the SSA considers net earnings and the nature of services performed. For example, work involving significant mental or physical activity and generating profit can be considered SGA. For blind individuals, self-employment SGA is determined solely by earnings, not time or services. Certain deductions, like Impairment Related Work Expenses (IRWE), reduce countable earnings for SGA, allowing individuals to earn more gross income while remaining below the SGA threshold.

Social Security Work Incentive Programs

The Social Security Administration offers several work incentive programs to support disability beneficiaries returning to work. These programs provide a structured framework and safety net, enabling individuals to test their work abilities without immediately jeopardizing benefits.

Trial Work Period (TWP)

The Trial Work Period (TWP) allows beneficiaries to test their ability to work for at least nine months while still receiving full Social Security Disability Insurance (SSDI) benefits, regardless of earnings. In 2025, any month with gross earnings over $1,160 counts as a TWP month. These nine months need not be consecutive but must occur within a rolling 60-month period.

Extended Period of Eligibility (EPE)

Following the TWP, beneficiaries may enter an Extended Period of Eligibility (EPE) lasting 36 consecutive months. During this period, individuals can continue receiving SSDI benefits for any month their earnings fall below the Substantial Gainful Activity (SGA) limit. If earnings exceed SGA in any EPE month, benefits are suspended but can be reinstated without a new application if earnings subsequently fall below SGA.

Impairment Related Work Expenses (IRWE)

Impairment Related Work Expenses (IRWE) allow beneficiaries to deduct costs for items and services necessary to work due to their disability. These include medical devices, specialized transportation, or attendant care. Deducting IRWEs from gross earnings reduces countable income for SGA, potentially allowing higher earnings while qualifying for benefits. For blind SSI recipients, Blind Work Expenses (BWE) allow deduction of any work-related expenses, including taxes, transportation, and costs for visual aids or guide dogs.

Plan to Achieve Self-Support (PASS)

The Plan to Achieve Self-Support (PASS) program, primarily for SSI beneficiaries, is another valuable work incentive. A PASS allows individuals to set aside money or resources for a specific work goal, like education, vocational training, or starting a business, without affecting SSI eligibility or payment. Funds set aside for the PASS are not counted as income or resources by the SSA, enabling beneficiaries to save for necessary expenditures to achieve self-sufficiency.

Distinctions Between SSDI and SSI Earnings Rules

Rules for how earnings impact Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) benefits differ significantly due to each program’s distinct nature. SSDI is an earned benefit based on work history and Social Security contributions, while SSI is a needs-based program for individuals with limited income and resources.

SSDI Rules

For SSDI recipients, continued eligibility primarily depends on whether earnings exceed the Substantial Gainful Activity (SGA) limit after work incentive programs. If a beneficiary consistently earns above the SGA threshold beyond allowed work incentive periods, SSDI benefits typically cease. SSDI focuses on the individual’s ability to engage in substantial work, not financial need or asset levels.

SSI Rules

In contrast, SSI is a needs-based program with strict income and asset limits. When an SSI recipient earns income, specific exclusion rules determine their “countable income.” Generally, the first $65 of earned income in a month, plus half the remaining earned income, is excluded. After applying these exclusions, the SSI benefit amount reduces dollar-for-dollar based on countable income. Thus, increased earned income directly reduces the monthly SSI payment.

Unearned income, like pensions, interest, or other government benefits, affects SSI benefits differently than earned income. Most unearned income is counted dollar-for-dollar after a small general exclusion, directly reducing the SSI payment. While SGA is considered for initial SSI eligibility, ongoing benefit calculation for an SSI recipient earning income focuses on specific income exclusions and resulting countable income, not solely on whether earnings meet or exceed SGA. For instance, the Student Earned Income Exclusion allows eligible students under age 22 to exclude up to $2,350 of earned income per month, up to a maximum of $9,460 annually, for 2025.

Reporting Earnings to the Social Security Administration

Timely and accurate reporting of all earnings to the Social Security Administration (SSA) is a legal obligation for disability beneficiaries. This ensures benefits are calculated correctly and prevents overpayments or underpayments. Failure to report earnings or providing inaccurate information can lead to serious consequences, including financial penalties and potential loss of benefits.

Reporting Methods

Beneficiaries have several methods to report earnings to the SSA. One common way is through the online “my Social Security” account, a secure portal for wage reporting for both SSDI and SSI recipients. Individuals can also report by phone to their local SSA office or by mailing pay stubs and other relevant documentation. Reporting in person at an SSA office is an option; obtaining a receipt for submitted documents is advisable.

Reporting Frequency and Details

The SSA generally advises monthly reporting of earnings, ideally by the 6th or 10th day of the month following receipt. When reporting, beneficiaries should include their gross wage amount (before taxes or other deductions) and the applicable month. For self-employment, net earnings are reported. Report any work expenses related to a medical condition, as these can impact countable income.

Record Keeping and Consequences

Maintaining thorough records of all reported earnings, including pay stubs, bank statements, and SSA correspondence, is important. These records verify information if discrepancies arise. Consequences of not reporting earnings or reporting inaccurately can include withholding benefits for several months, repayment of overpayments, and in severe cases of intentional deception, potential criminal charges for fraud.