Weighing the Financial Impact of Returning to Work When Collecting SSDI Benefits

Q: What should I consider when determining whether to attempt a return to work if I am collecting Social Security Disability Insurance (“SSDI”)?

Under the most straightforward and simplest fact patterns, navigating the application process to obtain SSDI benefits—including denials and appeals—can be time-consuming and overwhelming for a layperson without the help of an experienced Social Security Disability Attorney.

But once you have those SSDI benefits and if you are fortunate enough to have healed significantly, how do—and should—you return to the workforce? What will happen to your benefits if you do? Such a decision should not be made without the input of an experienced SSDI attorney.

While most people have a vague notion that if they earn too much income their Social Security benefits will be reduced or eliminated, it’s really far more complicated than that. A long list of factors to consider when contemplating a return to the workforce after collecting SSDI include the impact that decision will have on your lifetime Social Security retirement benefits, your current SSDI benefits, Medicaid benefits, and more, depending on your particular situation.

Consider a divorced woman about to turn 62 who is collecting SSDI of $760 a month and is considering returning to work to pull herself out of poverty, but she doesn’t know what impact a return to work will have on her SSDI benefits and future Social Security retirement benefits. More details are needed to make an informed decision.

For example, her marital status must be considered. The majority of people who are approaching retirement age will likely have been married at some point in their lifetime. The length and status of the marriage or marriages, the age of the spouse or ex, whether the spouse or ex is receiving retirement benefits and the amount, whether they are alive or dead, are all factors that may impact her Social Security benefits.

In an effort to encourage the disabled to return to work when they feel they are ready, the government provides that SSDI benefits will continue to be paid for at least the first 12 months (9 months of work and a 3-month grace period) after they return to work, regardless of how much the worker earns. This is called the Trial Work Period (“TWP”).

If after the TWP the worker earns more than what the government-set maximum monthly income ($1170 in 2017) allows to avoid being classified as a Substantial Gainful Activity (“SGA”), the worker will lose their SSDI benefits. But there is a safety net–it’s called the Extended Period of Eligibility (“EPE”).

As long as the worker continues to have the “disabling impairment”, they are entitled to receive SSDI benefits during the 36 month re-entitlement period that immediately follows the TWP–known as the Extended Period of Eligibility (“EPE”) –for all months in which their earnings or work activities are below the SGA level. SSDI benefits will not be paid for months when earnings exceed the SGA level. So for 2017, SSDI benefits may continue to be collected for the months the worker earns less than $1,170 but not for the months the worker earns more than $1,170.

As you can see, Social Security Disability Insurance matters and how they may impact Social Security retirement and other benefits are very complex and warrant the guidance and counsel of an attorney with extensive experience in handling these matters.

Regardless of where you are in the Social Security disability process, the attorneys at Peña and Bromberg PLC can help. Our practice has been devoted exclusively to Social Security disability and Veterans disability law since 1984. Call us at 866-282-6811 for a free disability consultation.

We serve clients throughout Central Valley California including San Francisco Bay, Oakland, Bakersfield, Madera, Stockton, Fresno, Sacramento, and Modesto, as well as nationwide.

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