SSDI Work Incentives

If you’re getting Social Security Disability Insurance (SSDI), it’s because your disability prevents you from going to work and earning enough to cover your expenses. However, you may want to give work a chance. It is possible that maybe if you just had a bit of time and knew that you wouldn’t lose your benefits, you could succeed at a job.

That’s why Social Security has made program rules and incentives that can help you get a job without having to worry that you’ll lose the benefits you need. For most persons who get SSDI, these work incentives function as a 3-stage process that begins when you get a job that pays more than the Substantial Gainful Activity (SGA) limit:

  1. The Trial Work Period (TWP) lets you work and get benefits at the same time, no matter how much you make.
  2. When the TWP ends, the 3-year Extended Period of Eligibility (EPE) starts and lets you work and get benefits for every month that you earn less than the SGA limit ($1,070 in 2014, $1,800 if you’re blind).
  3. For 5 years after you get your last SSDI cash benefits, Expedited Reinstatement (EXR) will let you quickly get back on SSDI if your income drops below the SGA limit and without you having to completely re-apply.

These 3 incentives mean that you can get a job and see how it goes. If it goes well, you’ll be in a better financial situation than before. If it doesn’t go well, you will be able to get SSDI and be in the same situation you were in before you tried working.

Note: If you’ve been selected for Social Security’s Benefit Offset National Demonstration (BOND), your SSDI work rules may be different from those described here. If you were in BOND, you'd know. Read DB101’s article on BOND for more information. Here are more detailed explanations of these incentives, plus some other ways that you can keep getting your benefits, even if you have a job.

Trial Work Period (TWP)

Social Security allows every person on SSDI a 9-month Trial Work Period (TWP) to try working. During your TWP, you can work and earn any level of income (even if it is more than Substantial Gainful Activity (SGA) limit — ($1,070 in 2014, $1,800 if you’re blind) and keep your full SSDI benefits.

Your TWP is 9 Trial Work months occurring within a 5-year window. Your 9 Trial Work months may occur consecutively (one right after another) or sporadically (not one right after another) within the 5-year window. The window stays open until you have used up all 9 Trial Work months. During your TWP, you will continue to get your full SSDI benefits, no matter how much you earn.

Trial Work Month

A Trial Work Month is any month that your gross earnings are more than $770 (in 2014).

If you earn more than $770 in a month, you use up 1 Trial Work month. If you earn less than $770, you don’t.

Note: Before you start working, you should check with Social Security or a Work Incentive Consultant to see if you've used up any Trial Work months. You may have used up some or all of your Trial Work months in the past and not realized it.

Extended Period of Eligibility (EPE)

Once you’ve used up all 9 Trial Work months, your Trial Work Period is over and your 3-year Extended Period of Eligibility (EPE) begins.

When your gross monthly earnings are less than the Substantial Gainful Activity (SGA) limit ($1,070 per month in 2014; $1,800 if you’re blind), you will keep getting SSDI benefits.

Deductions

During your Extended Period of Eligibility (EPE) and period of Expedited Reinstatement (EXR), Social Security allows for certain deductions when they calculate your earnings. These deductions are things that can help keep your earnings below the SGA level and let you keep getting SSDI benefits, even though you have a job. The most common deductions are called Impairment Related Work Expenses (IRWEs) and subsidies. For a more detailed description of deductions, click here.

During your EPE, the first time you earn over the SGA limit in a month, your 3-month Grace Period begins. During the Grace Period, you will keep getting SSDI cash benefits no matter how much you earn. After your Grace Period ends, your SSDI benefits will be $0 in any month that you earn above the SGA limit.

If you are not earning above the SGA limit when your 3-year Extended Period of Eligibility ends, you will continue to get SSDI benefits. If you are earning more than SGA, you will still be able to get back on SSDI if your income drops below the SGA limit. More about what happens after the EPE ends is discussed later in this article under Expedited Reinstatement.

Example

Tony’s Extended Period of Eligibility (EPE) began in March. He earned $600 per month in March, April, and May (less than the SGA limit). Tony’s SSDI continues in each of these months.

In June, Tony earned $1,200 (more than the SGA limit). His June earnings cause his Grace Period to begin. Tony keeps getting SSDI benefits for July, August, and September, no matter how much he earns because those are his 3 Grace Period months.

In October, Tony earns $1,200. He has used his Grace Period and his earnings are above the SGA limit, so Tony doesn’t get SSDI benefits for October. In November, Tony earns $960 (less than the SGA limit), so he gets SSDI benefits again. In December, his earnings go back up to $1,200 (more than the SGA limit), so he doesn’t get SSDI benefits for that month.

This pattern can continue for the rest of Tony’s EPE. Every month he earns less than the SGA limit, he will get SSDI benefits during the following month. Every month he earns more than the SGA limit, he will not.

Notes:

  • It is always important to report any changes in work and income to Social Security right away to avoid overpayments.
  • It is also important to report when your earnings are below the SGA level. Contact Social Security and ask that your benefits be "reinstated." If you don’t, you won't get SSDI benefits, even if your earnings are less than the SGA limit.

Expedited Reinstatement (EXR)

After you use up your Trial Work Period and Extended Period of Eligibility (EPE), your SSDI benefits stop if you are earning above the Substantial Gainful Activity (SGA) limit. Expedited Reinstatement (EXR) allows you to get up to 6 months of temporary SSDI cash benefits, if your income drops back below the SGA limit.

During those 6 months, Social Security will conduct a medical review to see if you still meet their definition of disability. If you do, your benefits can start again without you having to reapply. If you are not considered to be disabled, your SSDI benefits will stop. If you have questions about Expedited Reinstatement, talk to a Work Incentive Consultant.

Deductions

During your Extended Period of Eligibility (EPE) and period of Expedited Reinstatement (EXR), there are some ways to lower your gross monthly earnings, so that Social Security won’t count everything you make. These are called “deductions.” Here we’ll talk about the most common deductions that can help you lower your gross monthly earnings below the Substantial Gainful Activity (SGA) limit, so that you can work and keep getting your SSDI benefits check.

Note: These deductions cannot be used during the Trial Work Period (TWP).

Impairment Related Work Expenses (IRWEs)

Impairment Related Work Expenses (IRWEs) are things you pay for yourself that are related to your disability and that you need to work. Social Security doesn’t count earned income that you use to pay for these expenses when they calculate your income. IRWEs include things like:

  • Medication copays
  • Adaptive equipment
  • Vehicle modifications
  • Personal care attendant costs
  • Special transportation costs

Social Security must approve the items that you want counted as IRWEs. You can use this form to request that Social Security approve your IRWEs. If the IRWEs are approved, Social Security will deduct these expenses from your income when they are calculating your SSI benefits or figuring out Substantial Gainful Activity. That makes it more likely that you will continue to get SSDI benefits.

Subsidies and Special Conditions

Subsidies and special conditions are supports you get on the job that result in you getting more pay than the actual value of the services you perform. A subsidy is support you get from your employer; special conditions are generally supplied by someone other than your employer, for example, a Vocational Rehabilitation agency.

Social Security considers subsidies and special conditions when they make an SGA decision. They only use earnings that represent the real value of the work you do to decide if your work is at the SGA limit. This is good for you because if Social Security decides that you have a subsidy or special conditions, you can earn more while still getting benefits.

Subsidies or special conditions may exist if:

  • You get more supervision than other workers doing the same or a similar job for the same pay
  • You have fewer or simpler tasks to complete than other workers doing the same job for the same pay, or
  • You have a job coach or mentor who helps you perform some of your work.

If you think you get a subsidy, talk to Social Security about it. They may ask you to get a letter from your employer, so they can document that you get a subsidy. If you think special conditions may apply to you, talk about it with Social Security or your mentor/job coach to see what they need to have to give you credit for having special conditions.

Unincurred Business Expenses (Self-Employment)

Unincurred Business Expenses are contributions made by others to your self-employment business effort. Examples include things like:

  • A friend working for free
  • A government agency paying for some of your business expenses
  • Someone giving you things of value — such as office space free of charge

Social Security deducts the value of any unincurred business expenses from your net income when deciding if you have reached the SGA limit for any given month. Social Security uses fair market value to assess the value of any unincurred business expenses.

Example

Joe gets office space from his vocational rehabilitation agency at no charge. The value of the office space is $300 per month.

Joe’s net income is $1,200 per month (higher than the SGA limit). Social Security deducts the $300 for the office space from Joe’s $1,200, so Joe’s countable income is only $900. He is not over the SGA limit and will keep getting SSDI benefits.

Plan to Achieve Self-Support (PASS)

A Plan to Achieve Self-Support (PASS) lets persons who get Supplemental Security Income (SSI) save money for a work-related goal. Income that is put into a PASS does not count as earnings by SSI and the money you save is not counted as resources.

If you get SSDI benefits, it only helps you if you also get SSI benefits or if you would qualify for SSI benefits if you put some of your earnings into a PASS. For more information on Plans for Achieving Self-Support, click here.

Example

Juan has a disability and gets a $600 SSDI check each month. He also gets a $100 SSI check each month. Between the 2 benefits, he’s just able to cover his expenses.

He talks to a Work Incentive Consultant and learns that if he puts the $600 he gets from SSDI into a PASS, then SSI wouldn’t count that money when they calculate his benefits. That means that when Juan puts his SSDI money into the PASS, Social Security will give him more SSI benefits!

He decides to put the SSDI money each month into a PASS that will let him save up money to go to a community college. Now, he still gets his $600 SSDI check, but saves it all in his PASS. His SSI check went up to $700, because SSI isn’t counting the money he saves in the PASS.

He still has the same amount of money to cover his expenses, but now he’s also saving up money and will be able to get the training he needs to get a job in the future.

Continued Payment - Section 301

Section 301 lets you continue to get SSDI benefits, even if you no longer meet Social Security’s criteria for being disabled, as long as you are participating in an approved Vocational Rehabilitation program that is expected to help you become self-supporting.

Programs and providers that are usually approved for Section 301 include:

To find out if a specific provider or program is approved under Section 301, talk to a Work Incentive Consultant or visit your local Social Security office. You can also call Social Security at 1-800-772-1213 or 1-800-325-0778 (TTY).