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When Will I Stop Getting Social Security Disability Benefits?

Christy Bieber, The Motley Fool

Social Security disability benefits are a very important source of income for around 8.5 million disabled workers in the United States. For many people who cannot work because of a serious health issue, these benefits are their only funds, and are necessary to meet basic living expenses.

If you're one of the millions receiving income from the Social Security Administration (SSA) as a result of your disability, it's important you understand how the benefits program works. In particular, you need to know what could cause your benefits to stop, so you don't put your income at risk.

A number of different things could put an end to your benefits, including reaching retirement age and switching to retirement benefits; going back to work; no longer meeting the definition of "disabled"; or exceeding asset limits. However, these factors won't always stop your benefits -- that can depend on different factors, including whether you're receiving Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI).

This guide will explain some of the factors that could cause your benefits to end, so you can avoid jeopardizing income you depend on, or so you can plan for a change in benefits that's inevitable.

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SSDI vs. SSI

Since there are different rules for when disability benefits stop for SSDI and for SSI, it's important to understand the differences between these programs:

  • SSDI benefits are earned benefits. You become eligible by paying Social Security taxes and earning work credits. The number of credits needed depends on your age at the time of disability. The amount of your benefits is based on wages earned, and there's no asset limit -- you can receive SSDI benefits even if you're wealthy.
  • SSI benefits are needs-based. Eligibility is based on having a limited income and few financial assets, not based on work history. Benefits are standard -- eligible persons receive $771 per month in 2019 -- and can be reduced if your income is too high.

You can learn more about each program in our complete guide to disability benefits. For now, it's simply important to note that some things will cause your benefits to stop in one program, but not the other.

With that in mind, let's look at the factors that could cause disability benefits to end.

1. Reaching retirement age

Social Security provides both retirement and disability benefits -- but the two programs are different.

When you reach retirement age and become eligible for retirement benefits, this could affect your ability to continue receiving disability benefits. The specific impact of reaching retirement age will vary depending whether you get your disability benefits through SSDI or SSI.

Receiving SSDI and reaching retirement age

If you are receiving benefits from SSDI, you generally cannot get both retirement and Social Security disability income. When you hit your full retirement age (FRA), the Social Security Administration will change your monthly benefits from the disability program to the retirement program. (FRA is determined based on when you were born and is between 65 and 67.) You will not notice a difference in your income when this happens.

While you typically can't get both retirement and SSDI benefits, there's one exception: if you filed for early retirement benefits after becoming disabled, then were determined to be disabled.

You can file for retirement benefits as early as age 62. However, benefits are reduced for early filing, which is defined as filing any time before FRA. The reduction in benefits is permanent and varies based how early you claim. Starting benefits at 62 when your FRA is 67 could result in as much as a 30% reduction (you can learn more about how claiming Social Security early affects retirement benefits).

If you claim Social Security retirement benefits before FRA because your disability stops you from working, and you are subsequently approved for SSDI, your early retirement benefits will have already begun. However, when you're approved for disability benefits, the Social Security Administration brings up your monthly checks to the amount you'd have received at FRA; this could result in a significant increase in income. This only happens if the SSA determines you were disabled prior to early retirement, though.

When you're approved for SSDI, you typically also get retroactive benefits. So if you had several months when you received a reduced retirement benefit but you subsequently qualify for SSDI, you could receive back pay for the difference between the lower retirement benefit you received in those months and the higher amount to which you were actually entitled.

Say, for example, you became disabled because you developed a serious heart condition, and you claimed Social Security retirement benefits early because you couldn't work anymore. If your benefit at a full retirement age of 67 would've been $1,000, but you retired five years early and benefits were reduced by 30%, you'd get only $700 in monthly benefits. If you apply for SSDI and qualify for it two months later, your monthly benefit would go up to $1,000, and you'd be repaid the $300 for each of the months you received a reduced benefit.

There is a risk of applying for retirement benefits in hopes you'll later be approved for SSDI. If you aren't approved, your retirement benefits will be permanently lower because you claimed them prior to FRA. Still, if you need the money to live on when a medical condition prevents you from working, this may be your only option -- especially since it can take a very long time for an application for disability benefits to be approved.

Reaching retirement age on SSI

When you reach retirement age and are receiving Supplemental Security Income, things are a little different. It's possible you may still qualify for SSI if your retirement benefits from Social Security are pretty low. SSI benefits are meant to help low-income disabled, elderly, and blind people -- even if those people also get retirement income. However the key to determining whether SSI benefits stop at retirement age is the amount of income you have coming in, as SSI benefits are needs-based and there are income limits.

In 2019, you can receive SSI if your countable income is below the federal benefits limit of $771 per month (though some states supplement SSI and have different income thresholds). There are different rules for figuring countable income for earned income versus unearned income; Social Security retirement benefits are considered unearned income.

When figuring countable income, the SSA doesn't count the first $20. This means you can actually receive SSI benefits if total unearned income -- including Social Security benefits -- is less than $791 per month.

While you can keep getting SSI benefits as long as retirement benefits plus other countable income come in below the limit, SSI benefits are reduced when you receive outside money.

For unearned income, you'll see a dollar-for-dollar reduction in monthly SSI benefits for any money you get (above the first $20 that doesn't count). If you receive a $700-per-month Social Security retirement benefit, SSI benefits would be reduced by $700 and you'd get just $71 monthly from SSI to supplement your retirement benefits.

2. Going back to work

Disability benefits are intended for people who cannot work, so returning to work could jeopardize your continued access to them.

However, there are programs in place to allow you to attempt working. The SSA also provides help to disabled benefits recipients who are hoping to work; this includes vocational training through its Ticket to Work program.

This does not mean working won't affect benefits, though. In fact, in some cases, earning too much income from work can cause benefits to stop. Once again, though, the rules for when this happens differ for SSI and SSDI recipients.

Going back to work while getting SSDI benefits

SSDI recipients are allowed to try their hand at working during a Trial Work Period without losing access to any disability income.

During the trial period, you can continue to get full benefits no matter how much you earn, as long as you still meet the definition of "disabled" and you report the work you're doing. This Trial Work Period lasts nine months. As soon as you have worked nine months within any 60-month period, the trial period ends.

A month counts as a work month for your Trial Work Period if your earnings from work exceed $880 (as of 2019). If you're self-employed, a month counts if you work more than 80 hours in your business, or if you earn more than $880 in self-employment profit after deducting business expenses. The income threshold for a month to constitute a "work month" can change periodically.

Once you've hit the nine-month limit, your Trial Work Period is over. However, for the next 36 months, you are allowed to receive disability benefits in any month where you don't have substantial earnings. For 2019, you have substantial earnings if you make more than $1,220 in a month, or more than $2,040 if you're blind. These limits can also change from year to year.

If your benefits are stopped because you have substantial earnings, you also have an expedited reinstatement period. During this five-year period, you can ask the SSA to restart benefits at any time if your condition prevents you from continuing to work. You won't have to go through the full application process again, or wait for the SSA to review your medical status before resuming benefits.

If you incur expenses associated with working while disabled -- such as paying for counseling services, adaptive devices, or transportation to work made necessary by your disability -- these expenses can be deducted from your countable income. For example, if you're unable to drive to work due to your disability, you spend $200 per month on taxis, and you make $1,000 per month: The $200 in taxi costs would be deducted, so your income would come down to just $800 and the month wouldn't count as a work month.

Going back to work while getting SSI benefits

The rules differ for SSI beneficiaries. You can continue to receive SSI while working only if your income is below the SSI income limits.

The limits for earned income are different from those for unearned income (such as the Social Security retirement benefits mentioned above). You can receive up to $1,627 per month in earned income without being disqualified from receiving SSI.

The earned income limit is higher than the unearned income limit because the SSA deducts the first $20 of all income, the first $65 of earned income, and half of all additional earned income when determining if you fall below the $771 monthly federal benefits limit. If you earn $1,627, the first $85 is subtracted, leaving you with $1,542 -- and only half that amount, or $771, counts. That's why you can receive $1,627 in earned income and still get benefits, versus only $791 in unearned income.

While you can continue to receive SSI benefits while working as long as you're below the $771 federal benefits limit, benefits are reduced. After subtracting the first $85 in earned income that doesn't count, the SSA will subtract $0.50 for each dollar you earn from your monthly paycheck. So, if you earned $1,000 per month, you'd subtract $85 to get $915; your SSI benefits would be reduced by half that amount, or $457.50.

3. No longer meeting the definition of "disabled"

The SSA has a very strict and narrow definition of what it means to be disabled. You have to prove you meet all these criteria when you apply for benefits:

  • Your condition must have lasted at least 12 months, be expected to last at least 12 months, or be terminal.
  • Your condition must have a significant impact on your ability to do basic work activities such as sitting, walking, or remembering information.
  • Your condition must prevent you from doing any work you did before.
  • Your condition must be on the SSA's Listing of Impairments or must be medically equivalent in severity to a listed condition. The Listing of Impairments is a long list of medical problems, including musculoskeletal issues, neurological disorders, and more. Conditions on the list, which is also called the Blue Book, can usually qualify you for benefits provided you exhibit specific required symptoms for your listed ailment.

The SSA periodically conducts Continuing Disability Reviews to make sure you're still entitled to benefits. The frequency with which SSA reviews your medical history depends on your condition:

  • If medical improvement is expected, you may have your case reviewed every six to 18 months.
  • If improvement is possible but not expected, your case may be reviewed every three years.
  • If improvement isn't anticipated, you may go as long as five to seven years without a review.

Other events, such as earning income from work or completing a vocational rehabilitation program, could also trigger a Continuing Disability Review.

You'll be notified when this review is taking place and will be expected to cooperate, which could mean completing and returning forms or even undergoing a medical exam.

If the SSA finds you no longer meet its definition of "disabled," this will result in an end to your SSDI or SSI benefits. The SSA could also discontinue benefits in some cases if it finds you haven't complied with treatment recommendations, and that this failure to follow doctor's orders has contributed to your continued inability to work.

You have 60 days to initiate an appeal if you're found to no longer be disabled. There are multiple stages of appeal, if you want to fight to preserve access to income you depend on.

4. Exceeding asset limits

SSDI doesn't have asset limits, but SSI does. If you have more than $2,000 in countable resources, you will not be approved for benefits. Obtaining more than $2,000 worth of countable resources can also cause benefits to stop if you're already receiving them. This could occur, for example, if you receive an inheritance or a generous cash gift.

Some things you may own aren't considered countable assets, though; these include a home where you live, your personal possessions, and tax refunds for up to 12 months after they're received. So, receiving these items may not necessarily put a stop to SSI benefits. For a list of resources that do and don't count in determining whether you've exceeded asset limits, see the guide to SSI.

Now you know what could cause your Social Security benefits to stop

Social Security disability benefits may provide you with your only income if you can't work. It's important to know what could affect that income.

Now you know that the rules differ depending whether you're receiving SSDI or SSI benefits. However, benefits could stop if you work too much while receiving them; if your medical condition improves and you are no longer defined as "disabled"; or, for SSI, if you exceed asset limits. Your benefits could also end if you switch to retirement benefits.

With these factors in mind, you can plan for how to protect your access to benefits, or how to adjust your budget once you know your benefits will be coming to an end.

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