Terry Petterson of DisablogND recently posted about changes in the Social Security rules which now let you report earnings to SSA by telephone:

Beneficiaries, deemors and representative payees reporting a change in wages can report their monthly wages to SSA by telephone. These instructions explain what beneficiaries, deemors, and representative payees need to do in order to use the SSA phone system to report monthly wages.

Beneficiaries, deemors and representative payees who would rather not report wages by telephone can use traditional reporting methods such as mailing or bringing paystubs into their local Social Security office. Monthly telephone reporters who experience technical difficulties should contact their local field office for assistance.

For more information, including when you should call to report wages, and what you need to have before you call, check out the article at DisaBlogND.

As discussed previously, impairment related work expenses (IRWEs for short — pronounced “Eer-whee’s”) are a way of reducing an individual’s earnings below the substantial gainful activity threshold, and thereby preserve eligibility for disability benefits.

Social Security has a great chart showing examples of which IRWEs are deductible (can be used to reduce income) and which are non-deductible (cannot be used to reduce income):

Keep in mind that these are just examples and not an exhaustive list of allowable IRWEs.

For more information, check out the Social Security Red Book.

To qualify for Social Security disability benefits you have to show that your disability prevents you from being able to work. In Social Security’s words, you have to show that you are unable to engage in a substantial gainful activity (SGA). SGA translates into a maximum dollar amount you are allowed to earn and still be potentially eligible for Social Security benefits.

For 2009, the most you can earn is $980 per month (before taxes or deductions).  If you earn more than this, Social Security may say that you are engaging in a substantial gainful activity and, therefore, not eligible for disability benefits.

The SGA issue is so important that it is the very first step of the 5 step sequential evaluation process – the way Social Security evaluates adult disability claims!

What do I do if I earn more than the substantial gainful activity amount? Does than mean I can’t get Social Security disability benefits?!?

Not necessarily. There are exceptions that may allow you to still qualify for Social Security disability benefits even if you are earning more than the SGA amount.

Some of these exceptions include:

1. Impairment Related Work Expenses (IRWE).
2. Subsidized Earnings and/or Sheltered Employment.
3. Unsuccessful Work Attempts (UWA).
4. Trial Work Period (TWP). Note: TWP are a way to test your ability to work if you are already on Social Security while still preserving eligibility for Social Security benefits.

If Social Security has said that you earn too much, it is not the end of your case.

This is a particularly tough question. I previously wrote about how earning more than the Substantial Gainful Activity amount may cause your benefits to be stopped in Social Security Disability Insurance cases. 

In SSI cases, I just learned that you can earn more than the SGA amount and still keep your SSI benefits.

WARNING: I do not pretend to be a understand SSI benefits calculations. I strongly encourage anyone reading this to check this information with Social Security. Also, any Social Security technicians are more than welcome correct any errors I may make here.

To figure out how much you can earn, I need to introduce the 20-65-1/2 rule. This rule helps us determine the “countable earned income.”

If you are working, and receiving both Social Security Disability Insurance (SSDI, DIB) as well as Supplemental Security Income (SSI).

1. Subtract $20 from SSDI amount.
2. Subtract $65 from he amount you earn (before taxes or any deductions) then divide by 2.
3. Add the two amounts together

In other words: (SSDI – $20) + (gross income – $65) / 2 = countable earned income.

Let’s do an example

If you are getting $100 from SSDI and earn $150,

($100 – $20) + (($150 – $65) / 2)

$80 + ($85 / 2)

$80 + $43 (we rounded up)

$123

Now, you take the SSI benefit amount and subtract the number we just got. 

If you were getting $637 in SSI, you subtract the $123, which equals $551. This is the amount you will still get in SSI benefits. 

If you are receiving SSI and also working, you would use this formula

((gross income – (65 + $20)) / 2  

Note: the $20 is the unearned income disregard previously subtracted from the SSDI amount 

(gross income - $85) /2

Using the amount from the previous example:

($150 – $85) / 2 

($65) / 2 

$33

Social Security will subtract the $33 from the current SSI benefit amount. So, even though you earn $150, Social Security will only reduce your SSI benefits by $33.

Based on this formula, in 2009, you can earn just around $1,400 and still qualify for SSI benefits. But, please, if you find yourself in the situation really having to know how much you can make and still keep your Social Security SSI benefits, speak to Social Security. 

Note: if you were reveiving both SSDI and SSI, the $1,400 in income will probably make you lose your SSDI. So, keep in mind the exceptions I discussed in my earlier article.  Many of them apply in SSI cases as well. 

My thanks to Peter Komlos-Hrobsky, Supervising Attorney of the Health/Elder Unit of Colorado Legal Aid in Denver for bringing this to my attention.

To qualify for Social Security disability benefits you have to show that your disabilities prevent you from being able to work. In general, you have to show that you are unable to perform a substantial gainful activity (SGA).

However, there are exceptions to this general rule, including Subsidized Wages or Sheltered Work environments.

Social Security can only consider the money you earn in deciding if your work is a substantial gainful activity. Anything over the “reasonable value” of your work, may be a subsidy. Social Security cannot consider a subsidy, basically a “gift,” as earnings in determining if the work is a substantial gainful activity.

A subsidy is any compensation over the fair value of your work.  This often happens if you work for a family member or if you work through an agency like Goodwill.

If you are paid for a 40 hour week but you only work 25 hours, you have a 15 hour subsidy.  Another possibility is if the value of your work is $8.00 an hour, but you are paid $10.00 an hour (a $2.00 an hour subsidy).

If you subtract the subsidy, and your gross income is below the SGA amount, you might still be able to keep your Social Security benefits.

For example, if you are working for a an agency which receives state or federal funding to provide assistance, training or employment for individuals with disabilities, you may be working at a sheltered work environment and your wages may be subsidized.

I have also had many cases where an individual is given a job by a friend or family member and told to, “Watch the phones and take messages.” This may be both a sheltered work environment with subsidized earnings.

Another common example is in the military when a soldier becomes disabled. I have done a number of cases where the soldier was still receiving full pay in the military but whose duties were greatly reduced or eliminated due to disability. Sometimes, the soldier is part of the Warrior Transition Unit. Social Security will frequently consider this a sheltered work environment and allow the disability case to continue even though the earnings would otherwise be SGA.

Here are the regulations on this topic  (20 CFR 404.1574):

(2) We consider only the amounts you earn. When we decide whether your earnings show that you have done substantial gainful activity, we do not consider any income that is not directly related to your productivity.

• When your earnings exceed the reasonable value of the work you perform, we consider only that part of your pay which you actually earn.
• If your earnings are being subsidized, we do not consider the amount of the subsidy when we determine if your earnings show that you have done substantial gainful activity.
• We consider your work to be subsidized if the true value of your work, when compared with the same or similar work done by unimpaired persons, is less than the actual amount of earnings paid to you for your work.
• For example, when a person with a serious impairment does simple tasks under close and continuous supervision, our determination of whether that person has done substantial gainful activity will not be based only on the amount of the wages paid.
• We will first determine whether the person received a subsidy; that is, we will determine whether the person was being paid more than the reasonable value of the actual services performed.
• We will then subtract the value of the subsidy from the person’s gross earnings to determine the earnings we will use to determine if he or she has done substantial gainful activity.

(3) If you are working in a sheltered or special environment. If you are working in a sheltered workshop, you may or may not be earning the amounts you are being paid.

• The fact that the sheltered workshop or similar facility is operating at a loss or is receiving some charitable contributions or governmental aid does not establish that you are not earning all you are being paid.
• Since persons in military service being treated for severe impairments usually continue to receive full pay, we evaluate work activity in a therapy program or while on limited duty by comparing it with similar work in the civilian work force or on the basis of reasonable worth of the work, rather than on the actual amount of the earnings.

I previously wrote about the various exceptions which may allow you to keep your Social Security disability benefits even if you return to work. The most common of these is an Unsuccessful Work Attempt (UWA). 

If you work for 6 months or less at a substantial gainful activity (SGA) level, your work may qualify as an Unsuccessful Work Attempt and not affect your application for benefits (or your current Social Security disability benefits if you have already won your case).

Another benefit of the Unsuccessful Work Attempt exception is that it applies for both Social Security Disability Insurance (20 CFE 404.1574) and Supplemental Security Income (SSI) (20 CFR 416.974) cases. This is a major difference between Unsuccessful Work Attempts and Trial Work Periods.

A common misconception about Unsuccessful Work Attempts:

Before we get into what you need to prove to qualify for an Unsuccessful Work Attempt, let’s talk about the biggest mistake people make about Unsuccessful Work Attempts. 

Work lasting longer than 6 months cannot be an Unsuccessful Work Attempt. FALSE!

If the earnings drop to below the SGA level before the end of the 6 month period, the work can still be an Unsuccessful Work Attempt even if it lasts for more than 6 months.

The regulations dealing with Unsuccessful Work Attempts clearly state this (20 CFE 404.1574 & 20 CFR 416.974).

Ordinarily, work you have done will not show that you are able to do substantial gainful activity if, after working for a period of 6 months or less, your impairment forced you to stop working or to reduce the amount of work you do so that your earnings from such work fall below the substantial gainful activity earnings level.

How to qualify for an Unsuccessful Work Attempt

Here is how to prove your work was an Unsuccessful Work Attempt and should not count against you even though it would otherwise count as a substantial gainful activity.

1. A “significant break” between prior work and the Unsuccessful Work Attempt. 

According to SSR 05-02, a “significant break” means the following:

1. You were out of work for at least 30 consecutive days. Or 
2. You were forced to change to another type of work or another employer. 
3. However, on rare occasions a break lasting a few days less than 30 may satisfy this requirement if your subsequent work episode was brief and clearly not successful because of your impairment.

It is even possible to have a significant break without leaving your last job. Again, referring to SSR 05-02:

Such an interruption would occur when, because of your impairment or the removal of special conditions related to your impairment that are essential to your further performance of the work, the work was discontinued or reduced (or limited) to the non-SGA level.

How about that! You could even meet the “significant break” requirement if your earning drops below SGA levels due to a removal of special conditions.  Don’t worry, I will provide examples of “special conditions” in just a bit.

The next requirement changes depending on whether you worked for less than 3 months, or if you worked less than 6 months.

2. If you worked 3 months or less. 

We will consider work of 3 months or less to be an unsuccessful work attempt if you stopped working, or you reduced your work and earnings below the substantial gainful activity earnings level, because of your impairment or because of the removal of special conditions which took into account your impairment and permitted you to work.

This is the easiest way to have work qualify as an Unsuccessful Work Attempt.

If you work for 3 months or less at an SGA level, and had to stop either because of your disability or because the boss took away a special accommodation, it may qualify as an Unsuccessful Work Attempt, and not count against you.

3. If you worked between 3 and 6 months. 

We will consider work that lasted longer than 3 months to be an unsuccessful work attempt if it ended, or was reduced below substantial gainful activity earnings level, within 6 months because of your impairment or because of the removal of special conditions which took into account your impairment and permitted you to work and

(i) You were frequently absent from work because of your impairment;

(ii) Your work was unsatisfactory because of your impairment;

(iii) You worked during a period of temporary remission of your impairment; or

(iv) You worked under special conditions that were essential to your performance and these conditions were removed.

If you worked longer than 3 months, but less than 6 months, Social Security has a few more requirements to prove that the work was an Unsuccessful Work Attempt.

You still have to show that you had to stop either because of your disability. Additionally, you also have to show that you either missed a lot of work, did not do a good job, were working while your condition was better, or you had special accommodations which let you do the job, until the accommodations were taken away.

4. If you worked more than 6 months. 

We will not consider work you performed at the substantial gainful activity earnings level for more than 6 months to be an unsuccessful work attempt regardless of why it ended or was reduced below the substantial gainful activity earnings level.

In short, if you work more than 6 months at a SGA level, it cannot be an Unsuccessful Work Attempt.

You can have more than one UWA:

Did you know that you can have more than one Unsuccessful Work Attempt? 

As long as you meet the requirements of a “significant break” between Unsuccessful Work Attempts, many jobs can qualify as UWA.  This often comes up in bi-polar disorder cases where an individual has a tried to work in a lot of jobs, but has not lasted very long at any of them (often due to problems working with supervisors, co-workers, or the public). 

If you can eliminate each job as an Unsuccessful Work Attempt, you may be able to push the onset date further back and potentially increase your back benefits.

When CAN’T you use an Unsuccessful Work Attempt:

This will not apply for most people, but it is good to keep in mind:

When the UWA is Applicable: The UWA policy explained in this SSR is to be used in initial disability cases. It is also to be used in continuing disability cases in determining whether, because of work activity, your disability continues or ceases. However, the UWA criteria do not apply in determining whether payments should be made to you for a particular month during the reentitlement period after disability has been ceased because you did SGA, or during the initial reinstatement period after you have been reinstated through the expedited reinstatement provision. 

SSR 05-02

Basically, you can use an Unsuccessful Work Attempt to excuse work which is a substantial gainful activity when you are trying to get benefits or during a Social Security review if you have already won your case. However, you cannot use a Unsuccessful Work Attempt during a the Extended Period of Eligibility following a Trial Work Period.

Work under special conditions:

SSR 05-02 provides guidance about what constitutes “work under special condition.”

Performance of Work Under Special Conditions: One situation under which your SGA-level work may have ended, or may have been reduced to the non-SGA level, as set out above, is “the removal of special conditions related to your impairment that are essential to your further performance of work.” That is, you may have worked under conditions especially arranged to accommodate your impairment or you may have worked through an unusual job opportunity, such as in a sheltered workshop. Special or unusual conditions may be evidenced in many ways. For example, you:

a. May have required and received special assistance from other employees in performing the job; or
b. Were allowed to work irregular hours or take frequent rest periods; or
c. Were provided special equipment or were assigned work especially suited to your impairment; or
d. Were able to work only within a framework of especially arranged circumstances, such as where other persons helped you prepare for or get to and from work; or
e. Were permitted to perform at a lower standard of productivity or efficiency than other employees; or
f. Were granted the opportunity to work, despite your medical condition, because of family relationship, past association with the firm, or other altruistic reason.

Remember that these are examples only and other accommodations may also qualify as work performed under special conditions.

Social Security encourages you to try to go back to work to see if you can do it. A Trial Work Period (TWP) lets you work and still be considered disabled by Social Security.

A beneficiary receiving Social Security disability benefits may test his or her ability to work and still be considered disabled. We do not consider services performed during the trial work period as showing that the disability has ended until services have been performed in at least 9 months (not necessarily consecutive) in a rolling 60-month period. In 2007, any month in which earnings exceed $640 is considered a month of services for an individual’s trial work period. In 2008, this monthly amount increases to $670.

To sum up, a Trial Work Period lets you work and still be considered disabled by Social Security.  Not only that, but Social Security does not count all the months you work, just the ones where you earn more than a threshold Trial Work Period amount:

• 2009  -  $700 per month.
• 2008  -  $690 per month.
• 2007  -  $630 per month.

However, a Trial Work Period only applies in Disability Insurance Benefit claims under Social Security.  Supplemental Security Income (SSI) claims do not get a Trial Work Period. In other words, if you are only getting SSI, you do not get the 9 months to see if you can work while still being considered disabled by Social Security.  If you are on SSI and return to work, a different set of rules apply.

Also, Trial Work Periods only apply after you have been found disabled. If you return to work while you are applying for benefits, you cannot use a Trial Work Period to excuse Substantial Gainful Activity  level earnings. However, there are other exceptions which may apply.

How the Trial Work Period works:

1. If you earn less than the Trial Work Period amount, you can work and still be disabled.  Your earnings do not trigger a Trial Work Period.
2. You can work up to 9 months and earn the Trial Work Period amount, or more, without losing your disability status or your benefits.
3. The nine months do not have to be consecutive.  You might earn $1,000 in January, but only $400 in February and March, and then $1,100 in April.  January and April count as 2 of your 9 TWP months, but February and March do not.
4. If your gross income is more than the Trial Work Period amount for longer than 9 months (within a rolling 60 month – aka 5 year – period) Social Security will re-evaluate your case and may stop your disability status and stop your benefits.

But, what if I use up my 9 month Trial Work Period, my benefits stop, and then in the 10th month, something happens and I can’t work?  

Am I back to square one? 

Do I have to reapply for benefits?

Social Security has a safety net.  After the 9 month Trial Work Period, you may get a 36 month re-entitlement period, or “Extended Period of Eligibility” (EPE). During the Extended Period of Eligibility, Social Security may continue your benefits in any month that your gross earnings are not at the Substantial Gainful Activity (SGA) level.

The long wait for a Social Security hearing is a massive financial drain for most people.  With no money coming in, or just minimal state aid, a lot of people wonder how to pay for rent, utilities, and groceries.  

A number of my clients have asked me if they can try to get a job. 

Attorney Jonathan Ginsberg tackles this common question:

Remember that Social Security’s definition of disability looks to whether you have missed or are likely to miss 12 consecutive months because of your impairment. Attempting to work while your case is pending may or may not be a problem. If you try to work and last only a few days or even a few weeks, the judge will see that as an “unsuccessful work attempt” that demonstrates your sincere desire to work and your inability to do so.

Once you stay at a job for more than 3 months, however, it starts to look like you have the capacity to perform “substantial activity.”

There are also other problems you need to be aware of if you decide to try to work: 

When Social Security considers your ability to work, they generally consider only full time work. So, there should be no problem with doing part time work. Right? WRONG!

Even part time work can cause problems on a Social Security case.

If you can work part time in a “Light” type job, a shelf stocker at a supermarket for example, Social Security may take this to mean you are capable of full time work at an less physically demanding job, such as dispatcher, call-out operator, or information clerk. 

In other words, part-time work at one exertional level might suggest an ability to do full-time work at a lesser exertional level. 

Don’t structure a job to limit income.

If you earn more than the Substantial Gainful Activity Amount (SGA), in 2009: $980 per month before taxes and deductions, you are engaged in a Substantial Gainful Activity (SGA).  Under Social Security regulations, with some exceptions, this means you are not disabled.  

Some people think that if they just limit their hours to make sure they earn less than the SGA amounts, they will be ok.  

This could be Social Security FRAUD.  If you are able to work and earn SGA amounts, but you reduce your earnings to stay below SGA levels to stay eligible for Social Security, you are trying to defraud Social Security. You risk prosecution, so don’t do it.

Does the work disprove your disability?

Here is a quick example:

• You have social anxiety disorder.
• You have difficulty being around people. 
• You get a part time job as a customer service clerk.

Do you see a problem here?

The job is not a substantial gainful activity.  There is no issue of being able to do a less physically demanding job, or structuring earnings to keep income below SGA.

But, how is Social Security supposed to believe you are not able to work because of an inability to interact with the public, co-workers, and supervisors, when your entire job is interacting with people!

Even if you can explain this, you have just made your case much harder.

This are just a couple of the possible problems with working while trying to get Social Security benefits.

Like Jonathan, I do not want to discourage individuals from working.  I regularly work on cases where a client is doing some work while waiting for their Social Security hearing.  

But, there is no simple answer to the question of whether you should work while applying for Social Security disability benefits.  Each case requires a review of the job and the individual’s impairments to watch out for possible problems.  

Via What Happens to my Case if I Return to Work While Waiting for my Hearing?.

Updated 03/23/09.

A number of people responded to my prior post about “substantial gainful activity” amounts. To briefly review: the general rule is that you cannot earn more than the substantial gainful activity amounts to be found disabled.

What do I do if I am earning more than the substantial gainful activity amount? Does than mean I cannot get Social Security disability benefits?!?

Not necessarily. Earnings above SGA amounts are an important factor. But, there are exceptions (including sheltered work, subsidies, unsuccessful work attempts, impairment related work expenses, and trial work periods)  that may allow you to still qualify for Social Security disability benefits even if you are earning more than the SGA amounts. 

Check out our updated article for more information.  If you are earning more than the allowed SGA amounts, it is not the end for your case.

Social Security defines disability as the inability to engage in a “substantial gainful activity” (SGA).

A simplified way of putting this is to say that in order to be found disabled, you have to show that you are unable to work.  BUT, this can be misleading. Not all work qualifies as a substantial gainful activity.

So, how do you know if your work is a substantial gainful activity?

The easiest test is earnings.

In 2009, if your gross earnings, that is, before taxes or any other deductions, are $980 or more per month as an employee, that is probably a substantial gainful activity.  Keep in mind that the SGA amounts change from year to year.  The Social Security Substantial Gainful Activity page shows you the monthly earnings which qualify as a SGA for each year.

General rule: if your gross earnings are above the SGA amount, that work might prevent you from receiving disability benefits.

If you are earning less than the substantial gainful activity amount, you may still receive Social Security disability benefits, even though you are working.

I have worked with a number of individuals who are still working, but the work is not a substantial gainful activity.

So, if I earn less than the substantial gainful amount, I’m safe?

Not necessarily.  While having earnings less than SGA amounts is an important factor, there are instances, such as self-employment, or being able to control your earnings, when you may be earning less than the SGA amount, but still be considered performing a substantial gainful activity.

What if I earn more than the substantial gainful amount.  Does that mean I can’t get benefits?

You may have notice all the lawyer weasel words, “probably a substantial gainful activity,” “might prevent you from receiving disability benefits.” There are exceptions to the general rule that earnings above SGA make you ineligible for disability benefits.  Click the link if you are earning more than the substantial gainful activity amounts.

Updated 05/01/09.

Under Social Security regulations, disability is the inability to engage in a “substantial gainful activity.” This means that to win a Social Security disability case, you have to show that your impairments prevent you from being able to work.

More specifically, you have to show that you are unable to perform the duties of any work you have performed over the past 15 years AND that you are unable to perform the duties of any other work that exists in substantial numbers in the national economy. Note: these are steps 4 and 5 of the sequential evaluation process.

The general rule is that if you can still perform the duties of a job, you are not disabled. Note: this is a very simplified definition and there are a number of significant exceptions including whether the job is a substantial gainful activity, the effects of your age, etc. Right now though, I want you to understand the main issue in Social Security disability cases.

What DOESN’T Social Security consider when looking at your ability to work?

1. Social Security does not consider whether the kinds of jobs you can perform are available in your area.
2. Social Security does not consider if employers are hiring.
3. Social Security does not consider if you can get hired.

Phew! That’s a tough standard!