Ask the Expert: Report earnings to SSA

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If you receive disability benefits while working, you

If you receive disability benefits while working, you must report your work schedule and earnings to the Social Security Administration. Photo Credit: iStock

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Lynn Brenner Lynn Brenner

Brenner answers questions about all aspects of family finance.

A few years ago, my friend was receiving Social Security disability benefits, and worked longer than Social Security permitted. He's now unable to work at all. He receives a disability check every month, from which Social Security deducts money for the earlier overpayment. If he receives an inheritance, can Social Security take this inheritance, or will they just continue to deduct money from his disability benefit every month?

 

Your friend's inheritance won't have any effect on his Social Security disability benefit. However, it will probably disqualify him for Supplemental Security Income, or SSI, a disability benefit that's based on financial need.

He didn't necessarily break a rule by working while collecting a disability benefit. The law allows disabled people a nine-month "trial work" period, during which they can receive their full Social Security disability benefit, regardless of the amount they earn, provided they report their work activity to the Social Security Administration. (In 2013, a trial work month is any month in which your total earnings top $750, or, if self-employed, you earn more than $750 after expenses or work more than 80 hours in your own business.) After the nine-month trial is over, you can keep working for another 36 months; but during that time, you won't receive a benefit for any month in which you earn more than $1,040 (or $1,740 if you're blind) after deducting work expenses related to your disability.

It sounds as if your friend exceeded this 36-month extension and received a benefit overpayment as a result. When that overpayment is paid back, he should receive his full monthly disability benefit, regardless of his inheritance.

The bottom line If you receive disability benefits while working, you must report your work schedule and earnings to the Social Security Administration.

For more information Call the U.S. Department of Labor toll free at 866-968-7842 or visit choosework.net.

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TO ASK THE EXPERT: Send questions to Ask the Expert / Act 2, Newsday Newsroom,235 Pinelawn Rd., Melville, NY 11747-4226, or email act2@newsday.com. Include your name, address and phone number. Questions can be answered only in this column. Advice is offered as general guidance. Check with your own advisers for your specific needs.

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