One of the basic requirements for disability benefits is that your medical condition is so severe it prevents you from performing a substantial amount of work. The Social Security Administration (SSA) defines a substantial amount of work, which it calls substantial gainful activity (SGA), as earning $1,070 a month from working (in 2014). Therefore, if you are earning this much from work when you apply for benefits, you will be denied.
However, once you get approved for SSI, the SSA no longer considers whether you are doing SGA. But the SSA will reduce your benefits by subtracting part of your income from your payment, and terminate them if you go over the SSI income limit. In general, though, the SSA encourages SSI recipients to try to go back to work, and has created a number of work incentives that let a person work without losing their eligibility for benefits.
How Works Affects Your SSI Payment
Its important to understand how SSI benefit amounts are calculated before you can figure out how working will affect your payments.
For the year 2014, the SSA will pay up to $721 in SSI benefits (this doesn’t include any supplement your state may provide). This amount is called the federal benefit rate (FBR). Your monthly benefit amount is the difference between the FBR and your countable income. Your countable income is made up of the following:
•wages you are paid from your job (some of which is excluded)
•the value of free food and shelter provided for you
•support money from family or friends (though not all of your spouse’s earnings are counted against you), and
•payments from other sources, like veterans benefits or unemployment.
Earned Income Exclusion
Earned income means money you are paid from working. If you have earned income, the SSA will exclude the first $65 (if you don’t have any unearned income, $85 will be deducted instead), plus half of the remainder amount over $65 that you are paid each month. This reduces your countable income, which will help minimize the effects of your work on your benefit amount.
For example, if you make $1,465 per month, the SSA will subtract $65 (to get $1,400) and then half of the amount over $65 (to get $700). That $700 is your countable income from work, and it will be subtracted from your monthly SSI payment (which is $721 without a state supplement). You would still get an SSI payment of $21. In a nutshell, you can make a little over $1,500 a month before your SSI benefit is reduced to zero.