What are Social Security disability work incentives?

Subsidy and special conditions

Sometimes employers or vocational organizations offer financial support or other help to someone with a disability who is returning to work, such as longer paid breaks or a mentor to help them complete tasks. If this support is included in your paycheck, the SSA doesn’t count it in determining benefit eligibility. It only counts earnings that represent the “actual value” of the work you do.

Continued payment under vocational rehabilitation or similar program

If you are participating in a vocational rehabilitation program or something similar, the SSA won’t abruptly stop your benefits if your medical condition changes and you are no longer considered disabled.

Instead, payments will continue until the rehabilitation program ends, provided that you started it before your disability ended and Social Security decides continuing will lessen your chances of needing disability benefits in the future. 

Plans to Achieve Self-Support (PASS)

A PASS is an SSA-approved plan to achieve a specific professional goal within a set time period. If you use income from SSDI or other sources to pursue that goal — say, for education or child care — that income can be excluded from your SSI benefit calculation.

In addition, money you set aside for a PASS does not count against Social Security’s strict limits on savings and other financial assets for SSI recipients.

SSDI-only work incentives

Trial work period (TWP)

SSDI recipients can earn any amount from work during nine months over a five-year period without losing benefits. The months don’t have to be consecutive. The TWP ends once you’ve completed nine “service months” — in 2024, that’s a month in which you earn more than $1,110 before taxes or work more than 80 hours in self-employment.

Extended period of eligibility

This incentive kicks in after your trial work period ends. An extended period of eligibility lasts for three years, during which Social Security will continue to pay your SSDI benefit in months when you earn less than the SGA cap, as long as you still have the same disability that made you eligible for benefits in the first place.

Unincurred business expenses

If you are self-employed and receive business support such as donated supplies or unpaid administrative services from an individual or organization, it may qualify as an unincurred business expense. Social Security deducts the value of such support from your net income in determining whether you are over the SGA cap.

Continuation of Medicare coverage

SSDI recipients are eligible for Medicare, usually starting two years after they become entitled to disability benefits. If your SSDI ends because you earn too much from work, you can stay on Medicare for up to seven years and nine months past the end of your trial work period. Medicare Part A (hospitalization insurance) remains premium-free during this period.

Medicare for people with disabilities who work

When the premium-free period ends, you can buy Medicare, and in most cases get a discount on Part A premiums, if you remain medically disabled but ineligible for benefits due to work income.​

SSI-only work incentives

Earned income exclusion

Social Security does not include all earnings when calculating your SSI benefit. Under the earned income exclusion, it discounts the first $65 you make from work each month and one-half of the remaining earnings. There’s a separate SSI income exclusion for students under the age of 22.

Special SSI payments for persons who work

This incentive comes under Section 1619 of the Social Security Act, which allows people getting SSI on the basis of a disability to continue drawing benefits if their work income exceeds the substantial gainful activity cap. To qualify for special payments, you must still be disabled, meet all other SSI eligibility rules and have been eligible for SSI at least one month before you started earning SGA-level wages.

Reinstating SSI eligibility without a new application

If your payments ended because of work earnings but your income subsequently drops back below the SSI cap, you may be able to get benefits restarted without filing a new application. 

Along the same lines, if your SSI benefits or Medicaid coverage ended for any reason other than work earnings or medical recovery, you may be able to restart payments without filing an application within a year of the termination of benefits.

Special benefits if you are eligible under 1619

Typically, if you enter a public nursing home, hospital or psychiatric facility, or one where Medicaid pays more than half of your costs, SSI payments are cut off or severely curtailed. However, if you are working and eligible for SSI under Section 1619, you may receive your full cash benefits for up to two months after you’re admitted.

Medicaid while working

SSI recipients are automatically eligible for Medicaid in most states. If you lose SSI due to your work earnings, you may be able to stay on Medicaid as long as you meet all other SSI eligibility requirements, are still medically disabled and would need Medicaid in order to work. You may not qualify for this incentive if your gross income is high enough to replace both SSI and Medicaid benefits.