There are incentives and support for you to return to work, but the rules are a bit complicated and confusing, and the rules for Supplemental Security Income(SSI) and Social Security Disability Insurance(SSDI) are very different.
I discuss the general expectations for working under these programs on another post, while this one digs into the specific financial rules and values that you need to understand so that you can control when and if you get off of the program.
This post digs into the rules around SSI, and its sister post discusses the rules for SSDI. If you are dual-eligible, focus on the SSDI rules, and know that you are likely to lose your SSI benefits before your SSDI benefits are endangered.
When you do decide to work, there are two major resources for useful information that helps you. The first, which I discussed in the previously referenced post, is the Ticket to Work Program.
I highly encourage you to read over their site and use it to help yourself find appropriate supports for your education and job search.
The other main resource is The Red Book. It is published by the Social Security Administration, and available as a pdf or web document. It details the programs that can help you to stay eligible for SSI even if your income increases.
I wrote this post using The Red Book as a guide, so just understand that the book is your best resource for details on federal programs.
SSI income rules
SSI is a needs-based program and your SSI check varies based upon earned and unearned income.
If you are earning money at all, you need to report your income to SSI each month – and that reporting will eventually lead to smaller checks if you earn more money.
While you are on SSI and living independently, you can have unearned income(such as SSDI, interest, or investment-based income) up to $20 and earned income(employment-based income) up to $65 with no repercussions.
Once your earnings go over $65, your SSI financial benefits will go down by about $1 for every $2 you earn.
Eventually, you will reach your break-even point, where the income you earn is high enough that your benefit payment amount equals zero.
If you have unearned income, that is subtracted from the maximum income they could give you.
SSI payments are designed to keep you within a certain income range, so each income source you have reduces how large your SSI check will be.
As long as income is reported early in the month, the risk of overpayment(and them expecting their money back- it happens!) is low.
So if you are working, you want to report your income for the month by the fifth or sixth of the following month so that your SSI check remains accurate.
So, if you work in June, you want to report your income before July 5th or 6th so that your check will be correct. All your SSI checks are based upon your earnings for the previous month – so the check at the beginning of May is based on your earnings in April and so on.
The good news is that when you are actively working(or preparing to work through schooling) you are unlikely to have a medical review.
Plan to Achieve Self-Support
PASS is basically a savings program that allows you to work with a supervisor, social worker, or other professional to develop a financial plan to help you achieve your work-related goals and eventually earn your way out of your disability program.
There are also designated PASS specialists hired by Social Security to double-check proposed plans and work with you to make sure that they are achievable and acceptable.
PASS allows you to put aside a portion of your monthly check towards employment-related goals, like paying for a course or certification, buying a necessary piece of equipment that will enable you to work, or otherwise directly assist you in finding or keeping a job.
The advantage is that any money you put aside through your PASS account is no longer counted as income, which will likely increase your SSI check once you start earning money.
It’s also useful for dual-eligibility(for both SSI and SSDI) if you have a low income through SSDI that’s near the eligibility threshold for SSI payments. As long as your participation in the PASS savings program continues, you can remain dual-eligible.
Understanding your break-even point and related calculations
You want to know your break-even point in advance, and potentially keep your income just below it until you are prepared to potentially risk your Medicaid coverage.
To calculate your break-even point, you take your benefit amount, multiply it by 2, then add the $65 allowance and the $20 unearned income allowance.
For example, if your SSI benefit is $700, your break-even point would be $1485. Once you earn that amount of money, you will no longer be eligible for SSI payments. You may still be able to keep your Medicaid for a bit longer though(see next section)
As long as your earnings stay under the break-even point, you will continue to get a check from SSI each month.
To learn just how big a check you get, you need to know your gross income if you work for an employer, or your net income if you are self-employed.
Your gross income is also known as your pre-tax income. It will be listed on your paystub.
It is not the amount on your check, but rather the amount of money your employer pays you before taxes are removed. The amount on your check is your net income. SSI only cares about your gross income when you have an employer.
If you are self-employed or doing gig work(paid per transaction), your net income is used in all calculations. Net income is your income after the expenses are removed.
If you are self-employed, any business expenses can be subtracted from your gross income before your payment is calculated.
As a blogger, for example, the cost of purchasing and maintaining my site is subtracted from my income before my eligibility is calculated.
While self-employed, you will need to keep a monthly profit-and-loss statement and report your net income to SSI at the beginning of the month.
When working for an employer, you can calculate how much your check will be reduced by taking your earned income(gross), subtracting $85, and dividing the result by 2.
The good news is that there are some things that can be subtracted from your income so that you can actually earn more than your break-even amount in a month if you have the right documented expenses and consistently prove it.
Medicaid coverage under SSI after you pass your break-even point
Once your net monthly income is over your breakeven point, you may need to request additional support from Social Security in the form of Continued eligibility for Medicaid, 1619(B).
There is, of course, a maximum income for that, too. The eligibility numbers up to 2019 are listed on the previously mentioned site, to give you the gist. The most up-to-date information, and the calculation used to reach the income threshold are updated annually, and are a little complicated.
It’s always going to be higher than your break-even point, and sometimes there’s a little wiggle-room around that number if your medical care costs are especially high.
Basically, though, if you’re looking to play things safe(something you generally want to do with these programs), your best bet is to keep your net earned income under your break-even point until you feel comfortable applying to expand your Medicaid coverage, and to stay under the threshold for your Medicaid coverage until or unless you are ready to purchase your own insurance coverage.
Impairment-related Work Expenses
When you work, many of the costs related to your condition can also be subtracted from your income before calculating your break-even point.
This goes by the acronym IRWE, and refers to everything that enables you to work, even if you also use it at home.
Examples may include your out-of-pocket payments for durable equipment(like a wheelchair), equipment to help work around an impairment(like a specialized computer), and, if needed, a home health aide to prepare you for work.
It also includes your costs associated with being able to travel to and from work, such as car modifications, ride-sharing, or daily taxi or uber payments for transportation to and from work.
For these, the entire cost isn’t necessarily considered but rather the difference between what it cost, and how much you would have paid for a similar service if not for your condition.
For example, if you cannot take public transportation, that cost is subtracted from the cost of your transportation service and your IRWE value for transportation is that difference.
Determining your IRWEs can feel daunting, and may need to be recalculated on a somewhat regular basis as your expenses change, but depending on your condition and limits, it’s possible to do a job that pays much more than SGA and remain eligible for your benefits by using your IRWE deductions
Due to the nature of my condition, I have very few potential IRWE expenses(possibly travel expenses, but not much else), but if you are paying for a Personal Care Assistant, then this could add up to a substantial deduction.
This is something you can use whether or not you are working. I’m mentioning it here because it is another way to reduce the income numbers used in your calculations.
ABLE accounts are not yet available to everyone with disabilities but are very useful if your condition began before you turned 26.
It is possible to have an ABLE account before you get SSI, though that will require additional doctor’s notes and an agreement that you are disabled according to federal law.
If you became disabled prior to the age of 26(your current age doesn’t matter) and are still disabled you can start an ABLE account.
The money in the ABLE account must be used to support your disability-related needs, but that includes things like food and housing.
The really cool thing about an ABLE account is that any money put into it doesn’t count towards your $2,000 asset limit unless there is over $100,000 in the account.
That would be a lovely problem to have, right?
If you are eligible to create an ABLE account and thinking about going to work, I believe you can deposit part of your paid income into your ABLE account each month and that is not included in the calculations of your assets, except by the Social Security Administration itself.
I know that you also can have money deposited into your ABLE account by friends and family(so this is a way to get around having a parent or sibling set up a special needs trust for you), as long as the total gifted this way stays under $16,000 a year.
Also, in some cases, your employer can deposit additional money to your ABLE account if you do not participate in a retirement savings program with your employer.
I currently do not have an ABLE account, but am eligible – I’m considering opening one for myself.
State work-support programs
Finally, it is possible that your state may have a program specifically designed to support your employment while managing a disability.
In New Jersey, for example, there is the Workability program, which expands your eligibility for Medicaid way over the usual earned income limitations.
A New Jersey resident on Workability can earn up to $2,603/month and remain Medicaid-eligible!
They also can have up to $20,000 in assets(as opposed to $2,000), not including home, car, or designated retirement account!
This program does not exist in all states, and each state that has a similar program will likely have slightly different rules, but it is well worth looking into it to see if your state can help you this way.
When I was first on SSDI, I had a three-month period where I was ineligible for my mother’s insurance(I aged out), but not yet eligible for Medicare through SSDI. The workability program saved me.
I was able to find a part-time position, which allowed me to be eligible for the workability program. I sent in my paperwork in early November and had my participation confirmed in late December. (I don’t recommend such a tight schedule, the wait was stressful!)
Through that program, I had Medicaid coverage for those three months and then was dual-eligible for years afterward, which saved me money(Medicaid covers Medicare costs) and gave me full coverage(Medicaid often covers Medicare’s residual costs).
Again, it’s possible your state doesn’t have a program, or for some reason you are ineligible, but it’s well worth the effort to do some research and find out!
Conclusion: The government does offer programs to help you work once you are on disability
While the rules often feel unclear or confusing, the programs are designed with the intention of helping us rejoin the workforce.
Make sure that you know your personal break-even point so you control when/if you need to adjust your Medicaid coverage.
If you have already switched to the 1619(B) coverage, be sure you know your state’s earning threshold for the current year, and double-check it each year.
Making sure that you maintain benefits until you are ready to be independent is possible, but involves a lot of careful calculations and some planning.
You can participate in the Ticket To Work program, which should help you in your planning and learning process. Remember that you do have the right to get your ticket back and give it to a different network if the first isn’t helpful.
There is a deduction called IRWE which accounts for any and all expenses you have that are specifically related to your condition.
You can use IRWE deductions to bring down your calculated income, which can help you stay under your break-even point. IRWE only counts for out-of-pocket expenses, but it can be a useful tool to help you manage your costs(especially for durable equipment) and increase your allowed income.
Altogether, the social security administration is doing its best to encourage people with disabilities to return to work if we feel able to.
While there is a potential for complexity in your calculations, it is possible to plan ahead and manage your income so that you get the coverage you need when you need it, but also have the power to leave the program when you are ready.