Since its inception, Social Security has benefitted hundreds of millions of Americans in need. A large portion of these benefits go to those with severe disabilities who are unable to earn sufficient wages.
To be sure Social Security goes to those who need it most, income plays a large role in deciding who receives Social Security disability insurance (SSDI) and Supple-mental Security Income (SSI).
How Much Money Can You Make on Social Security Disability?
You can make up to $1,470 (or $2,460 if you are blind) in 2023 on Social Security Disability or your benefits will stop, which is known as Substantial Gainful Activity (SGA). During the trial work period, there are no limits on your earnings, but you cannot exceed the SGA amount.Use our disability calculator to see how much you could be able to earn in disability benefits.
What Are the Income Limits in Order to Not Qualify for Benefits?
Because Social Security handles so many unique situations, there are many facets to this question. To answer it, we will start with the basic numbers and explore the exceptions/details from there.
Keep in mind that your situation may be unique, as not all income is evaluated by the SSA. Some forms as income, such as child support, will not count against your total monthly earned income.
To qualify for SSDI, you must earn less than $1,470 per month. To qualify for SSI, you must earn less than $794 per month.
While these numbers do fluctuate, the income limit typically falls around this range. Anyone who earns more than this amount from jobs or under-the-table work qualifies as engaging in “substantial gainful activity” (SGA). Those who have SGA are considered independent enough to earn a living and do not qualify to receive disability insurance from Social Security. However, due to the national average wage index (which is used to create these income limits), these numbers tend to increase a bit each year.
Also important to note: the income limit to qualify for SSDI is raised to $1,260 for those who are blind. This is because the US government recognizes blindness as a unique disability in a world so catered to those with vision. This additional income is intended to cover any additional expenses that those who are blind need to survive.
How Much Can I Earn on SSDI?
A disabled person on SSDI or applying for SSDI cannot earn more than $1,470 per month by working. However someone who is earning SSDI can have any amount of income from investments, spousal income and any amount of assets.
Some Dorms of Income Are Not Included in These Limits
These differ slightly from SSDI to SSI. In regards to SSDI, most forms of income that are not made directly from work wages or under-the-table work are not included in substantial gainful activity. This includes investments, interest, a spouse’s income, or other assets.
When referring to SSI, it gets a bit trickier. Some assets and interest may count towards the monthly total while others may not. However, income from a spouse does affect the limit for SGA — couples have an income limit of $3,000/month in assets.
Even if you may have substantial gainful activity, you can still apply for SSDI/SSI.
Situations vary greatly from person to person. Depending on the nature of your disability and the nature of your income, you may still qualify for SSDI or SSI. Do not let these numbers prevent you from applying altogether — it is always better to apply and not qualify than not apply at all.
How Different Things Affect SSI
Because SSI is a needs-based disability program it means that anyone applying for SSI must only have income and assets that fall below a threshold. Those who have "countable income" above the federal benefit rate (FBR), which in 2023 was $914 for individuals and $1,371 a month for a married couple, are not deemed eligible for SSI.
Anyone who has some countable income, which falls below the FBR, will face having their monthly SSI payments decreased by the value of the countable income. If an applicant for SSI has no countable income at all and is eligible for SSI, he or she will be awarded the total FBR paid monthly.
Because SSI is viewed as a need-based program, this means to qualify for disability benefits payments a number of factors concerning your income and assets are taken into consideration. Any adult in receipt of SSI payments will have any assets and other financial resources considered as well as income before the SSI benefit can be paid. These could include any of the following:
- retirement funds;
- interest received as income from investments;
- support provided by family and friends;
- cash or assets from inheritance.
Any assets that have a monetary value like:
- houses;
- cars and other motor vehicles; and
- commercial rental property.
If you own only one home or one motor vehicle it is unlikely the value of these will be used in an SSI assessment. It is only likely to be evaluated if you own more than one vehicle or house.
However, if you are saving money by living with relatives or friends and paying no rent this could affect whether you qualify for SSI benefits. Additionally, if you are married to someone who is in receipt of SSI benefits you will receive a joint SSI benefit. This does arise typically every year based on cost-of-living adjustments (COLA).
If a person who has not yet reached aged 18 applies for SSI, the SSA is likely to consider both the income and financial resources of both the child and his/her parents. These could include the parents’ income from working in a job as well as any of the following:
- alimony,
- child support,
- retirement benefits,
- investment income.
How to Lose SSDI Benefits
The commonest reason why the SSA would stop a person’s Social Security Disability (SSDI) payments is because the recipient has gone back to work, even though this isn’t always the case. If you go back to your normal job when in receipt of SSDI benefits the SSA will decide if you are taking part in “substantial gainful activity” (SGA).
The key factor in deciding if work is considered to be SGA is the amount someone is paid. In 2023 somebody is typically considered to be engaging in SGA if his/her earnings exceed $1,470 or $2,460 for someone who is blind.
For example, if you are earning $200 weekly in a part-time job, you are not working above the SGA limit. If you are spending a lot of time at work but what you are doing constitute SGA despite the earnings being below the SGA threshold you could have your SSDI stopped.
However, if you are working and make over SGA you can be entered into a trial work period. This period allows somebody who is receiving SSDI benefits to try to go back to work without being told they will lose their SSDI eligibility.
In the majority of cases, you should be able to work for up to 9 months during a trial work period and you will still continue to receive your SSDI regardless of the amount you are earning. When the trial work period comes to an end and you are still taking part in a job earning above the SGA level the SSA is likely to decide you are no longer disabled so your Social Security Disability payments will stop.
Other reasons why your SSDI benefits will cease are the following:
- You have reached retirement age at 66 years and you will now no longer receive SSDI, but you will be eligible for social security retirement benefits instead.
- When put in prison your SSDI benefits will stop after 30 days of incarceration and will only continue the month after your release. You may be treated differently if you are taking part in a rehabilitation program.
- If you are convicted of felony but you are not incarcerated your SSDI benefits may cease but if convicted of a misdemeanor this will not have any effect on your SSDI benefits unless you are put I n jail for one month or more.
- If your parents are in receipt of SSDI and you are receiving benefits as a dependent under 18 years old when you turn 18 the SSDI benefits for you may stop.
How to Maintain Your SSDI Benefits
Being approved for SSDI benefits avoids financial hardship and most applicants have had to endure a difficult process to get these entitlements so in order to hold onto them you need to be aware of what you need to do. Two things you should do to keep your SSDI benefits active are as follows:
- Keep seeing your doctor as this confirms you still have a disability;
- Maintain contact with the SSA on a regular basis;
- Notify the SSA if there are any changes to your circumstances such as: changing address, charged with an offense, altering your name, losing custody of a child who is in receipt of SSI benefits and taking up employment.
In the majority of cases when your situation is reviewed by the SSA, it is typically confirming your ongoing need for disability benefits. If you can provide medical evidence that your health has not improved and if you have maintained contact with the SSA your SSDI benefits will probably remain the same. If the SSA decides to review your case and you lose your SSDI as a result you may appeal the decision within ten days of the SSA notification.
2 Minutes To See If You Qualify
Social Security can be complicated and very intimidating to apply for. It is also vital that everything is completed correctly so that your chances of receiving benefits are their highest. In addition to meeting financial requirements, you will need to meet a Blue Book listing for a disabling condition.
To maximize your potential to receive benefits, consider getting assistance from a Social Security attorney or disabilityadvocate. They can help in filing paperwork and presenting cases can make all the difference you need to qualify for the benefits you deserve. If you are denied disability, an attorney can help you file an appeal.
Additional Resources
- What Is SSDI
- Difference Between SSI and SSDI
FAQs
What is the Social Security income limit for 2022? ›
Retirement Earnings Test Exempt Amounts
$19,560/yr. ($1,630/mo.) NOTE: One dollar in benefits will be withheld for every $2 in earnings above the limit.
If you're younger than full retirement age, there is a limit to how much you can earn and still receive full Social Security benefits. If you're younger than full retirement age during all of 2023, we must deduct $1 from your benefits for each $2 you earn above $21,240.
How much can I earn in 2023 and still draw Social Security? ›Exception: If you will reach full retirement age in 2023 or already reached it in a prior year, select "Yes" only if you expect to earn over $4,710 in every month or perform substantial services in self-employment in every month of 2023. (In 2023, the monthly earnings limit is $4,710.)
Can I draw Social Security at 62 and still work full time? ›You can get Social Security retirement benefits and work at the same time before your full retirement age. However your benefits will be reduced if you earn more than the yearly earnings limits.
At what age can you earn unlimited income on Social Security? ›If you will reach full retirement age in 2023, the limit on your earnings for the months before full retirement age is $56,520. Starting with the month you reach full retirement age, you can get your benefits with no limit on your earnings.
At what age is Social Security no longer taxed? ›Are Social Security benefits taxable regardless of age? Yes. The rules for taxing benefits do not change as a person gets older. Whether or not your Social Security payments are taxed is determined by your income level — specifically, what the Internal Revenue Service calls your “provisional income.”
How do I get the $16728 Social Security bonus? ›Who is eligible for Social Security bonus? For every year that you delay claiming past full retirement age, your monthly benefits will get an 8% “bonus.” That amounts to a whopping 24% if you wait to file until age 70.
What changes are coming to Social Security in 2023? ›The most impactful change in 2023 is the 8.7% cost of living adjustment, or COLA, which takes effect this month. For instance, if you receive $2,000 a month from Social Security, the monthly payout will rise to $2,174 per month.
Do you pay federal taxes on Social Security? ›Some of you have to pay federal income taxes on your Social Security benefits. This usually happens only if you have other substantial income in addition to your benefits (such as wages, self-employment, interest, dividends and other taxable income that must be reported on your tax return).
How much Social Security pays you for every $1000 you earn? ›When you earn $1,000 in a given year, you'll potentially boost your average indexed monthly earnings by $1,000 divided by 420, or about $2.38. But because of the way the primary insurance amount formula works, the amount of benefits that $2.38 turns into will vary over the course of your career.
Why retiring at 62 is a good idea? ›
Your Social Security benefit is guaranteed to increase by 8% for each year of delayed claiming between your full retirement age and age 70. If you think you can beat that amount through other investments, you could receive more abundant financial rewards by taking Social Security early and investing the proceeds.
How much income can I make if I retire at 62? ›For the year 2023, the maximum income you can earn after retirement is $21,240 ($1,770 per month), without having your benefits reduced. The amount goes up each year. The maximum income limit doesn't change depending on your age; in other words, it's the same whether you're 62, 63, or 64.
Is Social Security based on last 3 years of work? ›We: Base Social Security benefits on your lifetime earnings. Adjust or “index” your actual earnings to account for changes in average wages since the year the earnings were received. Calculate your average indexed monthly earnings during the 35 years in which you earned the most.
What type of income reduces Social Security benefits? ›Earning While Receiving Social Security Benefits
The earnings cap is adjusted for inflation. For 2022, it is $19,560. Once annual earnings reach the cap amount, for every $2 a Social Security recipient under retirement age earns from working, the total annual benefit gets reduced by $1.
When you reach your full retirement age, you can work and earn as much as you want and still get your full Social Security benefit. If you're younger than full retirement age, and if your earnings exceed certain dollar amounts, some of your benefit payments within the one year period will be withheld.
What is the Social Security 1st year rule? ›There is a special rule that applies to earnings for 1 year, usually the first year of retirement. Under this rule, you can get a full Social Security benefit for any whole month you are retired and earnings are below the monthly limit.
What states do not tax Social Security income? ›- Alaska.
- Florida.
- Nevada.
- New Hampshire.
- South Dakota.
- Tennessee.
- Texas.
- Washington.
- Move income-generating assets into an IRA. ...
- Reduce business income. ...
- Minimize withdrawals from your retirement plans. ...
- Donate your required minimum distribution. ...
- Make sure you're taking your maximum capital loss.
The rationalization for taxing Social Security benefits was based on how the program was funded. Employees paid in half of the payroll tax from after-tax dollars and employers paid in the other half (but could deduct that as a business expense).
Does money in the bank affect Social Security retirement benefits? ›Social Security does not count pension payments, annuities, or the interest or dividends from your savings and investments as earnings. They do not lower your Social Security retirement benefits.
What is the Social Security bonus trick? ›
Wait as Long as You Can
Waiting until age 70, however, has the opposite effect. For every year that you delay claiming past full retirement age, your monthly benefits will get an 8% “bonus.” That amounts to a whopping 24% if you wait to file until age 70.
Social Security survivors benefits are paid to widows, widowers, and dependents of eligible workers. This benefit is particularly important for young families with children.
What is the Medicare earnings limit for 2023? ›The government has updated the income limits for 2023, which — per Medicare Interactive — are now: up to $1,719 monthly income for individuals. up to $2,309 monthly income for married couples.
What is the Social Security 5 year rule? ›You must have worked and paid Social Security taxes in five of the last 10 years. • If you also get a pension from a job where you didn't pay Social Security taxes (e.g., a civil service or teacher's pension), your Social Security benefit might be reduced. 2. There is no marriage penalty or limit.
Should I have taxes withheld from my Social Security check? ›You must pay taxes on up to 85% of your Social Security benefits if you file a: Federal tax return as an “individual” and your “combined income” exceeds $25,000. Joint return, and you and your spouse have “combined income” of more than $32,000.
How much tax is taken out of your Social Security check? ›NOTE: The 7.65% tax rate is the combined rate for Social Security and Medicare. The Social Security portion (OASDI) is 6.20% on earnings up to the applicable taxable maximum amount (see below). The Medicare portion (HI) is 1.45% on all earnings.
What states tax Social Security? ›Eleven states in the U.S. impose some form of income taxes on Social Security benefits, as of tax year 2022: Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, and Vermont. The other states and District of Columbia don't tax Social Security benefits.
How much will my Social Security be if I make 50000 a year? ›For example, the AARP calculator estimates that a person born on Jan. 1, 1961, who has averaged a $50,000 annual income would get a monthly benefit of $1,386 if they file for Social Security at 62, $1,980 at full retirement age (in this case, 67), or $2,455 at 70.
How much is Social Security going up in 2023? ›Social Security benefits and Supplemental Security Income (SSI) payments will increase by 8.7% in 2023. This is the annual cost-of-living adjustment (COLA) required by law.
How much is Social Security if you make 100000 a year? ›If your highest 35 years of indexed earnings averaged out to $100,000, your AIME would be roughly $8,333. If you add all three of these numbers together, you would arrive at a PIA of $2,893.11, which equates to about $34,717.32 of Social Security benefits per year at full retirement age.
What is the healthiest age to retire? ›
Retiring Between Ages 41 – 45 (The Best Age Range To Retire)
You're likely in your prime earning years, making leaving your job that much harder. But after 20+ years of work, you won't feel as much shame retiring or taking things down a notch. After all, you've been working longer than the time you spent in school.
Can I Retire At 62 with $400,000 in a 401(k)? Yes, you can retire at 62 with four hundred thousand dollars. At age 62, an annuity will provide a guaranteed level income of $25,400 annually starting immediately for the rest of the insured's lifetime.
Is it better to take Social Security at 62 or 67? ›You can start receiving your Social Security retirement benefits as early as age 62. However, you are entitled to full benefits when you reach your full retirement age. If you delay taking your benefits from your full retirement age up to age 70, your benefit amount will increase.
What is the penalty for retiring at age 62 in terms of collecting Social Security benefits? ›If a worker begins receiving benefits before his/her normal (or full) retirement age, the worker will receive a reduced benefit. A worker can choose to retire as early as age 62, but doing so may result in a reduction of as much as 30 percent.
What is the maximum Social Security benefit at age 62? ›The maximum benefit depends on the age you retire. For example, if you retire at full retirement age in 2023, your maximum benefit would be $3,627. However, if you retire at age 62 in 2023, your maximum benefit would be $2,572. If you retire at age 70 in 2023, your maximum benefit would be $4,555.
Do you get more money if you retire at 63 instead of 62? ›Monthly Social Security payments are reduced if you sign up at age 63, but by less than if you claim payments at age 62. A worker eligible for $1,000 monthly at age 66 would get $800 per month at age 63, a 20% pay cut. If your full retirement age is 67, you will get 25% less by signing up at age 63.
Do stay at home moms get Social Security? ›Just because you don't bring home a paycheck doesn't mean you're not working. A stay-at-home parent can get a Social Security check just like any other worker.
How can I increase my Social Security benefits? ›Additional work will increase your retirement benefits. Each year you work will replace a zero or low earnings year in your Social Security benefit calculation, which could help to increase your benefit amount. Social Security bases your retirement benefits on your lifetime earnings.
How much can I earn while on Social Security in 2022? ›Starting with the month you reach full retirement age, there is no limit on how much you can earn and still receive your benefits.
How many hours can I draw Social Security at 62? ›Regardless of the reasons you might have, the good news is that once you reach full retirement age, you'll no longer suffer any penalties for working. You'll be entitled to your full monthly Social Security benefit regardless of how many hours you work.
How can I maximize my Social Security benefits at 62? ›
- Check your earnings record. ...
- Consider delaying your claim. ...
- Work longer – even for a year or two. ...
- Claim spousal benefits. ...
- Don't forget about your ex-spouse. ...
- Understand the impact of earned income. ...
- Avoid or minimize taxes.
If a worker begins receiving benefits before his/her normal (or full) retirement age, the worker will receive a reduced benefit. A worker can choose to retire as early as age 62, but doing so may result in a reduction of as much as 30 percent.
What is the least amount of Social Security you can draw at 62? ›For 2021, the minimum earnings threshold was $15,930, and it increased to $16,380 in 2022. For 2022, a worker with 11 years of coverage receives a special minimum Social Security benefit of $45.50 per month, while a worker with 30 years of coverage gets a special minimum benefit of $950.80 per month.
What is the highest Social Security check at age 62? ›The maximum benefit depends on the age you retire. For example, if you retire at full retirement age in 2023, your maximum benefit would be $3,627. However, if you retire at age 62 in 2023, your maximum benefit would be $2,572. If you retire at age 70 in 2023, your maximum benefit would be $4,555.
At what age can you collect Social Security and work full time? ›If you're eligible for Social Security, you can start collecting your benefits as early as age 62, and you can also continue to work.
What is one way to earn more money through Social Security? ›Continuing to work, even after retirement, and earning a higher salary can also raise your Social Security benefit amount. Married couples have the additional option of collecting spousal payments, which can also increase Social Security income.
What is the lowest amount of Social Security? ›For 2022, the special minimum benefit starts at $45.50 for someone with 11 years of coverage and goes to $950.80 for workers with 30 years of coverage. A financial advisor can help you plan your retirement taking into account your Social Security benefits.
How much is Social Security a month at 62? ›According to the SSA's 2021 Annual Statistical Supplement, the monthly benefit amount for retired workers claiming benefits at age 62 earning the average wage was $1,480 per month for the worker alone.
How do I check how much Social Security I will get? ›Your Social Security Statement (Statement) is available to view online by opening a my Social Security account. It is useful for people of all ages who want to learn about their future Social Security benefits and current earnings history.
What is the average Social Security check at age 66? ›At age 62: $2,572. At age 65: $3,279. At age 66: $3,506. At age 70: $4,555.