Work Incentives for Supplemental Security Income Beneficiaries

The Social Security Administration's work incentives program was instituted to help disabled individuals take advantage of employment opportunities and thereby gain a measure of independence. Special rules were designed to reduce the risk that a disabled or blind Supplemental Security Income (SSI) beneficiary who chooses to work would lose their SSI or Medicaid benefits.

There are various incentives available and beneficiaries may be able to take advantage of more than one. For one such incentive, the Social Security Administration (SSA) excludes certain income from its calculation for the individual's benefit amount. The first $65 of an individual's earned income is excluded from the calculation. Additionally, only half the earned income over $65 is used in the benefits calculation. Students who are under age twenty-two receive an income exclusion that allows them to earn a specified amount before any income will be counted in figuring their benefits amount.

Another incentive allows disabled individuals to deduct from their earned income the amount for expenses and certain services, which are related to their disability, that are necessary to enable them to work. For blind individuals, this same incentive applies. However, the expenses do not have to be disability-related.

Disabled or blind beneficiaries may set up a "Plan to Achieve Self-Support" (PASS) by putting aside income and resources for use in reaching an occupational goal. The SSA does not use the income and resources set aside under a PASS when figuring the beneficiary's SSI benefit. Further, part of the income and resources of the beneficiary's spouse, or parents if the beneficiary resides with them and is older than fifteen, are excluded from the benefits calculation.

The SSI and Medicaid benefits provided to a beneficiary will not cease just because the beneficiary engages in substantial gainful activity as long as the beneficiary's impairment remains. Further, the beneficiary may still be eligible for Medicaid benefits, even if his earned income is too high to receive SSI benefits, if his earnings are under a given amount and he still needs Medicaid to be able to work.

Copyright 2011 LexisNexis, a division of Reed Elsevier Inc.