Despite the stringent “total disability” standards applicable to Social Security Disability Insurance (“SSDI”) claimants, some beneficiaries can work part-time while receiving SSDI benefits. Many beneficiaries don’t know about the Social Security Administration’s (“SSA”) work allowances because the majority of SSDI beneficiaries can no longer work in their usual occupations.
Serious medical conditions, such as loss of a limb, paralysis, or blindness, may prevent beneficiaries from earning a living by working full time, thus qualifying them for SSDI. However, many SSDI beneficiaries want to keep one foot in the workforce. They may plan on returning to work, enjoy their careers, or emotionally benefit from occupying their time. A disabled artist may wish to sell a painting, while an accountant undergoing cancer treatment may want to work a few hours a week remotely. Whether you’re looking to earn income from a hobby, work part-time, or start a small business from your home, there are options for SSDI beneficiaries.
Qualifying for SSDI
SSDI is a federal insurance program designed to provide long-term disability benefits to qualifying American workers. It’s estimated that over 90% of American workers are preliminarily eligible to apply for SSDI benefits; as such, only claimants with serious disabilities that prevent all meaningful work are entitled to SSDI benefits. You cannot receive SSDI unless a qualifying medical condition prevents you from working in your usual occupation and you cannot adjust to new work. There are some notable exceptions for legally blind claimants and those suffering from compassion allowance (“CAL”) conditions such as:
- ALS (Lou Gehrig’s Disease)
- Trisomy 18 (Edward’s Syndrome)
Despite most disability claimants’ inability to work, the actual standard is whether you can or cannot enough in “meaningful” work or “substantial gainful activity.” The problem faced by many working claimants is that reporting any job, even part-time one, to the SSA may result in a denial of your claim. Further, beneficiaries receiving SSDI for a long-term disability may fear starting a job as their conditions improve because this may result in a loss of benefits. The SSA actually has work incentive programs for beneficiaries to help mitigate these fears and balance your desire to rejoin the workforce with your need for continued supplemental disability benefits.
Working While Receiving SSDI Benefits – The “Substantial Gainful Activity” Standard
The SSA permits claimants and beneficiaries to engage in employment provided the employment isn’t considered a “substantially gainful activity“(SGA). This is typically measured based on the average monthly earnings you receive from the employment. In 2019, monthly earnings averaging over $1,220 a month (non-blind) are considered SGA and may result in a termination of your disability benefits. Certain SGAs include, but are not limited to, the following:
- Work, whether contract or employment, that brings in over the specified monthly dollar amount after subtracting any funds need to make accommodations for your disability,
- Providing substantially the same services as other business owners in your area, and
- Engaging in “unpaid” or “volunteer” work that either should be paid or is indicative of your ability to engaging in paid SGA activities.
Most employment-related activities are measured by the monthly earning standard above and not your work hours, but there are exceptions. For example, a paralyzed artist can sell a painting it took 3 hours to paint for $2,000, thus technically disqualifying her for SSDI. At the same time, a disabled sales consultant can work 100 hours a month and still make under the $1,220 threshold. The SSA will consider the specific facts of your case in determining whether your part-time job disqualifies you for SSDI benefits under the SGA standard.
Incentives and Trial Work Periods for Disability Recipients
Because SSDI is a type of long-term disability insurance for the severely disabled, most beneficiaries are not expected to rejoin the workforce. However, as medicine and conditions improve, some claimants explore returning to work. The SSA actually encourages recipients to return to work, school, or start a business by offering certain return to work incentives. These incentives allow for work “trial periods,” self-support savings plans, and help building a small business. These incentives may be available for part-time employees receiving SSDI benefits. They include the following:
- Trial Work Periods – If you’re considering returning to work but aren’t sure how your disability will impact you, you’re entitled to a trial work period of at least nine months. During this time, you’ll continue to receive your full SSDI benefits. If you earn more than $880 per month, it is considered part of your trial work period, which you must report to the SSA.
- PASS Plans – These “plans to achieve self support” provide benefits to those who want to begin working while on SSDI but need assistance meeting this goal. Incentives may include vocational training and rehabilitation and payment for training, school, and business equipment needed to meet these goals. These payments are not counted towards your income.
- Self-Employment Plans – The SSA will evaluate your business plan and may provide financial incentives while you work to build your business without it impacting your SSDI benefits. You may be able to take SSDI income to pay for business equipment and start-up expenses, and the SSA may replace that income by increasing your benefits.
Speak with a qualified SSDI attorney if you are or you’re interested in working part-time while receiving SSDI benefits. You may have more options than you think.
The Effect of Earnings on your SSDI Payments
Unfortunately, there are some drawbacks to working part-time while on disability. While there are certain exceptions, your monthly SSDI benefits will be reduced by your monthly income. Your benefits will typically be reduced by approximately half of your monthly take-home income. For this reason, SSDI beneficiaries should take advantage of the work incentive programs offered by the SSA. A qualified SSDI attorney can analyze your present and future career plans and help you choose the best option for your situation. This may mean only working a few hours a month, taking a trial work period, or transitioning off of SSDI.