Understanding the ins and outs of Social Security Disability benefits can seem intimidating, especially when it comes to understanding the rules about working while receiving benefits. This blog post provides information to help you understand how you could work while receiving disability benefits.
Understanding SSDI Benefits
Social Security Disability Insurance (SSDI) is a federal program that provides financial support to individuals who have difficulty working because of a severe physical or mental medical condition. To qualify for disability benefits, applicants must meet specific criteria:
- Medical Condition: The individual must have a severe medical condition that prevents them from engaging in substantial gainful activity (SGA). The SGA is the threshold of physical or mental labor income that the SSA deems substantial and disqualifies an individual from receiving disability benefits. The SGA threshold SGA is adjusted annually. The current SGA can be found here.
- Duration: The condition must have lasted or be expected to last for at least 12 months or result in death.
- Work Credits: Applicants must have earned sufficient work credits through previous employment.
Returning to Work While Receiving SSDI Benefits
The Social Security Administration (SSA) recognizes that some individuals may want to attempt returning to work but may fear losing their benefits if they can’t work as they previously did. So, the SSA established several regulations they call “work incentives” to help beneficiaries through the process of hopefully returning to work. Here are the key work incentives to understand:
Trial Work Period (TWP)
The SSA recognizes the importance of encouraging individuals with disabilities to explore their work potential without immediately jeopardizing their benefits. This is where the Trial Work Period (TWP) comes into play. During this nine-month period, individuals can test their ability to work without having their monthly disability payments affected, regardless of how much they earn. Individuals do not need to complete these nine months consecutively, but they must finish them within a 60-month timeframe.
Extended Period of Eligibility (EPE)
Once the TWP has been exhausted, individuals enter the Extended Period of Eligibility (EPE) This 36-month phase allows them to continue receiving disability benefits for any month in which their earnings fall below the SGA threshold. However, if their income exceeds the SGA limit in a particular month, they will not receive a disability payment.
Expedited Reinstatement (EXR)
If payments ended because of earnings above SGA, a five-year window exists to request resuming benefits. Expedited Reinstatement (EXR) allows former SSDI beneficiaries who become unable to perform SGA because of the same/related disability to receive provisional benefits for up to six months, while full reinstatement gets reviewed.
Allowed Deductions
The SSA allows several deductions that beneficiaries can apply to their earnings when calculating SGA while receiving disability benefits. The most significant is Impairment-Related Work Expenses (IRWE), which includes costs for items or services directly related to enabling the beneficiary to work with their disability. Common examples of IRWE include specialized transportation costs, assistive technology, medical devices, prescription drugs, and personal care assistance needed for work. Another important deduction is subsidies and special conditions, where employers may provide extra support or allowances because of the beneficiary’s disability. The SSA also considers unincurred business expenses for self-employed individuals, which are contributions made by others to the beneficiary’s self-employment efforts. These deductions are crucial because they effectively lower the amount of earnings counted towards SGA.
Continued Medicare Coverage
Even if SSDI cash benefits stop because of work above the SGA threshold, individuals may continue to receive healthcare coverage under Medicare for at least 93 months after the TWP.
The Process of Returning to Work While on SSDI
So, if you receive SSDI benefits and wish to try returning to work without jeopardizing your benefits until you see if you can work as you did before your disability, this is the process you will go through.
- Starting Work: Notify the SSA when you begin working again. This starts your Trial Work Period if you haven’t used it before.
- During the TWP: You’ll receive full SSDI benefits regardless of your earnings. Use this time to assess your ability to work consistently.
- After the TWP: If you continue working, you’ll enter the 36-month Extended Period of Eligibility.
- During the EPE:
- Months where you earn above SGA: No SSDI payment (after a 3-month grace period).
- Months where you earn below SGA: You receive your SSDI payment.
- After the EPE: You should be able to continue receiving your SSDI payment if you remain unable to earn above SGA. If you consistently earn above SGA, your SSDI benefits may end. However, expedited reinstatement is available for five years if you need to stop working because of your disability.
Reporting Requirements While Working and Receiving Disability Benefits
Proper reporting is crucial to avoid overpayments and potential legal repercussions if you work and receive disability benefits. To avoid these issues:
- Report any changes in work activity to the SSA promptly.
- Inform the SSA about changes in duties, hours worked, or rate of pay.
- Keep detailed records of your earnings and work activity.
- Report any other income or changes that might affect your benefits.
Resources to Help You Further Understand Working While on SSDI
Returning to work while receiving SSDI benefits is a process that requires careful consideration and planning. By understanding these rules and regulations, you can make informed decisions about your work activities and their potential impact on your benefits.
To help you further understand your rights and options, here are some official resources where you can find more detailed information:
Here’s a list of official resources where individuals can learn more about working while receiving Social Security Disability Insurance (SSDI):
SSA Working While Disabled page– https://www.ssa.gov/benefits/disability/work.html
SSA’s Red Book (comprehensive guide to employment supports) –https://www.ssa.gov/redbook/
Ticket to Work Program– https://choosework.ssa.gov/
It’s important to remember that each situation is distinct, and the best solution for one person may not be suitable for another. It’s important to seek personalized advice if you’re contemplating returning to work while receiving SSDI benefits. You might want to consider consulting with a disability attorney or benefits counselor who can assist you in understanding your unique circumstances and provide guidance on maintaining your essential benefits while reintegrating into the workforce.