Can You Make Money While on Disability?

Individuals receiving disability benefits often wonder if earning income is permissible without jeopardizing their financial support. While a common misconception suggests any work is forbidden, the Social Security Administration (SSA) provides specific rules and programs allowing beneficiaries to work and pursue financial independence. These provisions support individuals in testing their ability to work and gradually increasing their earnings. Understanding these guidelines is essential, as the SSA encourages such efforts through various work incentives.

Understanding Income Rules for Disability Benefits

The Social Security Administration administers two primary disability benefit programs, each with distinct income rules: Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI).

For SSDI beneficiaries, the primary income threshold is Substantial Gainful Activity (SGA). SGA defines the amount of monthly earnings the SSA considers “substantial.” If an individual’s gross monthly earnings exceed the SGA limit, the SSA generally considers them no longer disabled for benefit purposes. In 2025, the SGA limit is $1,620 per month for non-blind individuals, and $2,700 per month for statutorily blind individuals. When evaluating SGA, the SSA primarily looks at gross earnings before taxes; for self-employment income, net profit is considered.

SSI is a needs-based program, with more complex income rules, considering both earned and unearned income. Unearned income reduces the SSI benefit dollar-for-dollar after a general exclusion. For earned income, the SSA applies specific exclusions to determine countable income, reducing the SSI payment. The first $65 of earned income in a month, plus one-half of the remaining earned income, is generally excluded. A $20 general income exclusion also applies to most income types, and these exclusions mean a portion of earned income does not count against the SSI benefit, providing an incentive for recipients to work.

Navigating Work Incentives

The Social Security Administration offers several work incentives to help beneficiaries transition back into the workforce without immediately losing their benefits. These programs allow individuals to test their work abilities and gradually increase their earnings.

Trial Work Period (TWP)

One primary incentive for SSDI beneficiaries is the Trial Work Period (TWP). This period allows individuals to test their ability to work for at least nine months while still receiving full SSDI benefits, regardless of earnings. The nine TWP service months do not need to be consecutive but must occur within a 60-month period. In 2025, a month counts as a TWP service month if gross earnings are $1,160 or more, or if a self-employed individual works more than 80 hours. During this period, earnings do not count against the Substantial Gainful Activity (SGA) limits.

Extended Period of Eligibility (EPE)

Following the TWP, SSDI beneficiaries enter a 36-month Extended Period of Eligibility (EPE). During the EPE, the SSA evaluates work and earnings based on SGA levels. Beneficiaries receive benefits for any month their earnings fall below the SGA limit. If earnings exceed SGA in a month, benefits are suspended, but eligibility can be reinstated without a new application if earnings fall below SGA again within the 36-month period.

Impairment-Related Work Expenses (IRWE)

Impairment-Related Work Expenses (IRWE) offer another work incentive for both SSDI and SSI beneficiaries. These are unreimbursed costs for items or services an individual needs to work because of their disability. Examples include medical devices, specialized transportation, or attendant care. The cost of these items can be deducted from gross earnings when the SSA calculates countable income for SGA purposes (for SSDI) or when determining the SSI payment amount. The expense must be paid by the individual, not reimbursed, and related to the disability and necessary for work.

Plan for Achieving Self-Support (PASS)

For SSI beneficiaries, the Plan for Achieving Self-Support (PASS) program provides an opportunity to set aside income and resources for a specific work goal. Funds set aside in an approved PASS plan are not counted as income or resources when determining SSI eligibility and payment amounts. This allows individuals to save for expenses like education, vocational training, or equipment needed to achieve their employment goal. A PASS plan must be written, outline a feasible work goal, and detail the expenses and timeline.

Ticket to Work

The Ticket to Work program serves as a broader resource connecting beneficiaries with employment support services. This program helps individuals with disabilities aged 18 to 64 find and maintain employment. It connects participants with Employment Networks or state Vocational Rehabilitation agencies, which offer services like job training, career counseling, and job placement assistance. The program allows participants to explore employment opportunities while protecting their disability benefits and healthcare coverage, and it can also suspend medical continuing disability reviews.

Reporting Earnings

Accurate and timely reporting of earnings to the Social Security Administration (SSA) is a mandatory responsibility for all disability beneficiaries who work. Failing to report income correctly can lead to overpayments or even suspension of benefits.

When starting a new job or experiencing a change in earnings, beneficiaries must notify the SSA promptly. For SSI recipients, this information should be reported no later than the 10th day of the month following the month of the change or earnings. SSDI beneficiaries also report changes in work activity, including when they start or stop working, changes in earnings, and any changes in their medical condition.

Beneficiaries can report gross monthly earnings through their My Social Security online account, the SSA Mobile Wage Reporting App, or an automated telephone wage reporting system. For more detailed reporting, such as when including Impairment-Related Work Expenses (IRWEs) or other work incentives, it may be necessary to mail pay stubs and supporting documentation to the local SSA office or visit in person.

The information to be reported typically includes gross monthly earnings before taxes, employment dates, and employer details. Maintain thorough records of pay stubs and tax documents. When submitting documentation, write your Social Security number on each page and keep copies for your records. Consistent reporting ensures the SSA accurately calculates benefit payments and applies work incentives, helping beneficiaries avoid unintended financial complications.

Effect of Work on Healthcare Coverage

Working while receiving disability benefits impacts healthcare coverage, with distinct rules for Medicare (SSDI) and Medicaid (SSI). The Social Security Administration has provisions to help beneficiaries retain their health insurance, which is crucial for those who rely on these benefits for medical care.

Medicare (SSDI)

For SSDI beneficiaries, Medicare eligibility typically begins after a 24-month waiting period from the entitlement to disability benefits. If cash benefits cease due to work, Medicare coverage can continue for an extended period. Premium-free Medicare Part A coverage continues for at least 93 months (7 years and 9 months) after the Trial Work Period ends. This extended period provides a safety net, allowing individuals to test their work capacity without losing vital health insurance. After this 93-month period, if earnings are sufficiently high, individuals may need to pay Medicare Part A premiums to maintain coverage. Medicare Part B and Part D premiums generally remain the responsibility of the beneficiary.

Medicaid (SSI)

For SSI recipients, Medicaid eligibility is often tied directly to receiving SSI cash payments. However, Section 1619(b) allows for continued Medicaid coverage even if SSI cash payments stop due to earned income. To qualify for 1619(b), an individual must have been eligible for an SSI cash payment for at least one month, continue to meet the SSA’s disability requirements, and meet all other non-disability SSI requirements. They must also need Medicaid benefits to continue working and have gross earnings not high enough to replace their SSI, Medicaid, and any publicly funded attendant care services. The SSA sets an annual income threshold for 1619(b) eligibility, which varies by state. This provision ensures individuals are not penalized for working by losing essential healthcare coverage, supporting their efforts toward greater financial independence.