How Does Work Affect Retirement, Survivors, Social Security Disability And Supplemental Income Benefits?

A Variety of Careers July 17, 2001

Social Security is with you through life’s journey. Social Security provides benefits at some of the most crucial intersections in life: at retirement, when a loved one dies and when someone becomes disabled. Social Security delivers monthly benefits that help replace some of the income lost because of these life events. Some people want to work while receiving benefits. You need to know that working while receiving benefits may affect benefits. Today, let’s talk about how work affects the various types of benefits that Social Security pays.
There is an earnings limit for those who choose to receive retirement benefits before their full retirement age and want to work. A limit on earnings while receiving retirement benefits defines the extent of retirement. The limit only exists for those under full retirement age. Once you reach full retirement age, there is only a limit for the months in the year before you reach full retirement age that year. In 2016, the limit for those under full retirement age is $ 15,720 and for the months before full retirement age for someone reaching full retirement age in that year the limit is $41,880.
If work exceeds the limits, some benefits are withheld. If the limit is $15,720, when the limit is exceeded, $1 in benefits will be withheld for every $2 in earnings. When the limit is $41,880, $1 in benefits is withheld for every $3 over the limit.
It is important to know that these benefits are only withheld temporarily. Benefits taken early are reduced benefits. If you earn over the limit and do not receive a payment for a month, the reduction for that month’s benefit is removed and the benefit is paid. But not until you reach full retirement age. We do a review of your benefits and your work and increase benefits to account for the months in which benefits were withheld. We do this at your full retirement age when your work history while receiving reduced benefits is complete.
Survivors benefits are subject to the same work rules discussed above.
But, there is one important difference to note. Benefits paid to spouses of retired workers and survivors who receive benefits due to having a minor child or disabled child in care are not refigured if benefits are withheld due to work.
Social Security disability benefits are paid when a worker is unable to work. Social Security pays disability benefits to a worker who can’t work because they have a medical condition (or combination of conditions) that is expected to last one year or to end in death. When someone who receives disability tries to return to work, they are entitled to a nine month trial work period. The trial work period allows you to test your ability to work.
During your trial work period, you’ll receive your full Social Security benefits regardless of how much you’re earning as long as you report your work, and you continue to have a disability. In 2016, a trial work month is any month your total earnings are over $810. The trial work period continues until you have worked nine months within a 60-month period.
After your trial work period, you have 36 months during which you can work and still receive benefits for any month your earnings aren’t “substantial.” In 2016, we consider earnings over $1,130 ($1,820 if you’re blind) to be substantial.
So to review, during the trial work period, there are no limits on your earnings. During the 36-month extended period of eligibility, you usually can make no more than $1,130 a month or your benefits will stop. But, we deduct the work expenses you have because of your disability when we count your earnings. If you have extra work expenses, your earnings could be substantially higher than $1,130 before they affect your benefits. This substantial earnings amount usually increases each year.
The rules for working while receiving Supplemental Security Income differ from the work rules for retired workers, survivors or those receiving Social Security Disability benefits.
We pay SSI benefits to people who are age 65, blind, or disabled, and who have little income or resources. If you’re disabled and work despite your disability, you may continue to receive payments until your earnings, added with any other income, exceed the SSI income limits.
If you work, you may have to pay for certain items and services for which people without disabilities don’t pay. We may be able to deduct these expenses from your monthly earnings before we decide if you’re still eligible for benefits. There are other work incentives we consider before benefits stop.
We base your SSI payments on how much other income you have. When your other income goes up, your SSI payments usually go down. So when you earn more than the SSI limit, your payments will stop for those months. But, your payments will automatically start again for any month your income drops to less than the SSI limits. You must report the drop in your earnings for Social Security to know when to resume SSI payments.
If your only income is SSI, and the money you make from your job, we don’t count the first $85 of your monthly earnings. Each month, we reduce your SSI benefits 50 cents for every dollar that you earn over $85.
Example: You work and earn $1,000 in a month; and your only income is your earnings and your SSI.
$915 divided by 2 = $457.50
We would take $457.50 from your SSI payment.
Here’s a tip about receiving benefits and working. Reporting earnings, changes in earnings and stopping work timely will help you avoid having Social Security pay you too much in benefits. A second tip is to know which type of benefit you receive and to follow the work rules for that type of benefit. And the best tip of all is too use our website to find out about work limits for your benefits or to call us at 1-800-772-1213 with any questions you have about work and benefits.


Mickie has worked for the Social Security Administration for over 35 years. As a Public Affairs Specialist, her goal is to make Social Security easy to understand.

You May Also Like