Social Security Disability Insurance (SSDI)
Tools to Reduce Countable Income

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California Department of Rehabilitation
Spotlight on Social Security

Social Security Disability Insurance (SSDI) Tools to Reduce Countable Income

Understanding the difference between gross wages and countable income is powerful knowledge. There are key work incentives, resources, and steps to help people receiving SSDI benefits reduce their countable income and protect benefits, potentially helping you keep benefits even when your gross earnings seem too high. By using tools like Paid Time Off, Impairment-Related Work Expenses (IRWEs), Subsidies, and Special Conditions, you can reduce your countable income and protect your SSDI benefits.

Programs and Support:

Practical Steps:

  • Use Paid Time Off (PTO): PTO (vacation, sick leave, holidays) is not counted as income by SSA. Keep documentation showing vacation, sick leave, and paid holidays. This helps reduce countable income even if gross pay appears high.

  • Claim IRWEs: Out-of-pocket costs for disability-related items/services needed for work. These expenses must be necessary for work and properly documented. Examples include medical devices, prescriptions and co-pays, service animal costs, and adapted transportation. Save receipts, bills, doctor statements, and maintain a detailed log showing disability‑related work expenses.

  • Apply Subsidies: When an employer pays more than the actual value of your work, SSA subtracts the value of the subsidy from your gross wages. Ask your employer to document any extra support or reduced duties.

  • Use Special Conditions: When using support from a third party (e.g., job coach) who helps you perform your job, SSA will deduct the value of this support from your income. Ask your job coach to document any extra support or reduced duties.

  • Document Everything: Save receipts, logs, and doctor’s statements for IRWEs.

  • Use the correct SSA forms, include a cover letter summarizing expenses and receipts, and submit documentation early. Prepare and submit forms such as Form SSA-821-BK (Work Activity Report – Employee), Form SSA-820-BK (Self-Employment), or Form SSA-3033 (Employer Questionnaire).

  • Be Proactive: Do not wait for SSA to request documents. Submit forms and supporting letters from employers or job coaches as soon as possible.

Key Takeaways:

  • Gross wages and countable income are not the same; tools like PTO exclusion, IRWEs, and subsidies can lower countable income.

  • SSA only counts the value of actual work performed, not gross wages.

  • Tools like PTO, IRWEs, Subsidies, and Special Conditions can reduce countable income and if countable income is below the SGA limit, SSDI cash benefits continue.

  • Track income, keep records, and submit documentation early to avoid overpayments.

  • Keep all documentation organized: receipts, logs, doctor statements, and letters from employers or job coaches.

  • Submit appropriate SSA forms early to prevent overpayments or benefit delays.

  • Stay informed about yearly changes to SGA limits and SSA work incentive policies.

  • Work Incentive Planners (WIPs) and DOR staff can help you apply these tools effectively. WIPA projects also provide free benefits counseling.

You now know about the powerful tools to reduce your countable income and protect your SSDI benefits while working. Using these tools is encouraged by Social Security which is why they are called work incentives.

For additional support, visit the California Department of Rehabilitation website to access resources to help you master these income reduction strategies. Explore the DOR Spotlight on Social Security YouTube Channel, where you will find webinars on the power of work incentives.

 

Resources

Benefits to Independence 101 Contact Directory Empowerment Essentials Meet the Team Spotlight on Social Security Newsletter Spotlight on Social Security Webinars Students Receiving Benefits Success Stories Ticket to Work Program Work Incentive Planning Services