What the 2023 SSDI Work Incentive Changes Mean for You

Congress passed the Ticket to Work and Work Incentives Improvement Act amendments in 2023, which expanded how much you can earn while receiving SSDI without losing your benefits. The most significant change raised the Substantial Gainful Activity (SGA) threshold — the income limit that determines whether Social Security considers you able to work — from $1,470 per month to $1,550 per month for 2024. This threshold increases each year based on wage growth, so the 2025 amount will be higher still.

The law also created a new expedited reinstatement process that lets you return to SSDI faster if you try working, earn too much, and then lose the ability to work again. Previously, if your benefits ended because you earned above the SGA threshold, you had to file a new claim and wait months for a decision. Now you can request reinstatement within five years without reapplying, and Social Security must decide within 60 days instead of the standard three to six months.

These changes matter most if you are considering part-time work, seasonal work, or a job that pays close to the SGA limit. They also matter if you have tried working before and your benefits stopped — you now have a clearer path back if work does not work out.

Key Takeaways

  • The SGA threshold for 2024 is $1,550 per month; you can earn up to this amount and keep your full SSDI payment, though the exact limit changes yearly.
  • If you earn above the SGA threshold, your benefits stop, but you keep Medicare for at least 93 months, giving you time to test work without losing health coverage.
  • The new expedited reinstatement rule lets you return to SSDI within five years if you stop working or drop below SGA, without filing a new claim.
  • Work incentives like the Plan to Achieve Self-Support (PASS) and Impairment Related Work Expenses (IRWE) still exist and can help you earn more while keeping some benefits.

How the SGA Threshold Works Under the New Rules

The SGA threshold is the monthly income line that Social Security uses to decide whether you are working at a level that shows you can do substantial work. If you earn less than the threshold, Social Security assumes you cannot work substantially, and you keep your full SSDI payment. If you earn more, your benefits stop — but this does not mean you lose SSDI permanently.

For 2024, the threshold is $1,550 per month. This applies to most people on SSDI. If you are blind, there is a separate, higher threshold of $2,590 per month. These numbers are set by federal law and do not vary by state or by how much you actually work — only your gross monthly earnings matter.

The threshold is not a cliff. If you earn $1,551 in one month, you do not when ready lose benefits. Social Security looks at your average earnings over a trial work period and then over a nine-month period after that. The exact timing depends on whether you are in your trial work period (the first nine months you work after benefits start) or in the nine-month extended period that follows. During the trial work period, you can earn any amount and keep your full benefit check.

What Happens to Medicare and Medicaid When You Earn Above SGA

This is the part that changed most for people considering work. Under the old rules, if your SSDI benefits stopped because you earned too much, your Medicare ended too — usually within a few months. The new law extended Medicare coverage to 93 months (nearly eight years) after your benefits stop due to work and earnings.

This means you can try a job, earn above SGA, lose your SSDI check, but keep your Medicare coverage while you figure out whether the job is sustainable. If the job does not work out — because of your condition, because the pay is too low, or because the work is too demanding — you can request expedited reinstatement and get your SSDI back without reapplying. Your Medicare never stops, so there is no gap in coverage.

Medicaid works differently and varies by state. Some states end Medicaid when SSDI stops; others continue it for a period. You should contact your state Medicaid office or your local Social Security office to learn what your state does. In some states, you may stay on Medicaid even after SSDI ends, which is a major advantage if you are considering work.

The Expedited Reinstatement Process and How to Use It

Before 2023, if you worked and earned above SGA, your benefits stopped. To get them back, you had to file a new claim, wait for a medical review, and hope Social Security agreed you were still disabled. This process took three to six months and created a gap in income and benefits.

The new expedited reinstatement rule shortens this. If your benefits stopped because of work and earnings, and you stop working or drop below SGA within five years, you can request reinstatement instead of filing a new claim. Social Security must decide within 60 days. You do not have to prove your condition got worse — only that you are no longer earning above SGA.

To request expedited reinstatement, contact your local Social Security office or call 1-800-772-1213. Tell them you want to request reinstatement under the expedited process. Have your Social Security number ready and be prepared to explain why you stopped working or why your earnings dropped. Social Security will ask for recent pay stubs or a letter from your employer showing your current earnings.

This rule is a safety net. It means you can try work with less fear that you will be stuck without benefits if the job does not last. You have five years to change your mind and come back to SSDI without reapplying.

Work Incentives That Still Help You Earn More

The SGA threshold is not the only way to earn money while on SSDI. Two older work incentives — Impairment Related Work Expenses (IRWE) and Plan to Achieve Self-Support (PASS) — let you exclude certain earnings or expenses from the SGA calculation, so you can earn more and still keep your benefits.

IRWE lets you deduct the cost of items or services you need because of your disability in order to work. If you need a wheelchair-accessible van, a personal attendant, medication, or specialized equipment, you can subtract those costs from your gross earnings before Social Security calculates whether you are above SGA. For example, if you earn $2,000 per month but spend $600 per month on disability-related work expenses, Social Security counts only $1,400 toward the SGA threshold.

PASS is a written plan you file with Social Security that sets aside income and resources for a specific work goal — like getting a degree, starting a business, or buying tools for a trade. Money set aside under a PASS does not count toward your SGA calculation or your resource limit. PASS is more complex and requires Social Security approval, but it can let you save thousands of dollars while staying on SSDI.

Both of these incentives existed before 2023 and still exist now. The new law did not change them, but it is worth knowing about them if the SGA threshold alone does not give you enough room to work.

How the Changes Affect Your Taxes and Benefits Calculation

SSDI itself is not taxed — your benefit check is not income for tax purposes. However, if you earn wages from work, those wages are taxable income, and you must report them to the IRS like any other employee.

The SGA threshold affects only whether Social Security thinks you can work substantially. It does not affect how much federal income tax you owe or whether you have to file a return. Those rules are separate and depend on your total income from all sources.

If you are working and receiving SSDI, you should report your earnings to Social Security every month. Social Security has a form called the SSA-821 for reporting work activity. Reporting on time helps Social Security track whether you are above or below SGA and prevents overpayments. If you do not report and Social Security later finds out you earned above SGA, you may have to repay benefits you received while working.

State-by-State Differences and What You Need to Know

SSDI is a federal program, so the SGA threshold, the trial work period, and the expedited reinstatement rule explore the same way in every state. However, Medicaid rules vary significantly by state, and some states have their own work incentive programs that layer on top of the federal rules.

A few states offer Medicaid Buy-In programs that let you stay on Medicaid even after your SSDI benefits stop, as long as you meet income and resource limits. These programs are designed to help people with disabilities work without losing health coverage. If you live in a state with a Buy-In program, you may have more flexibility to work and earn above SGA than the federal rules alone suggest.

To find out what your state offers, contact your state Medicaid office or ask your local Social Security office. The Social Security website also lists state-specific work incentive programs, though the list is not always current. A call to your local office is usually faster.

Frequently Asked Questions

Can I work part-time and keep my SSDI benefits?

Yes, as long as you earn less than the SGA threshold ($1,550 per month in 2024) and you are not in your trial work period. During the trial work period — the first nine months you work after benefits start — you can earn any amount and keep your full benefit. After that, you must stay below SGA to keep your benefits.

What happens if I earn above SGA for one month?

One month above SGA does not when ready stop your benefits. Social Security looks at your average earnings over a longer period. If you are in your trial work period, you can earn any amount. If you are past the trial work period, Social Security counts your earnings over a nine-month period. If your average is above SGA, your benefits stop, but you keep Medicare for 93 months.

If my benefits stop because I earned too much, do I have to pay them back?

No. When your benefits stop because you earned above SGA, that is not an overpayment — it is how the program is designed to work. You do not have to repay benefits you received while your earnings were below SGA. You only have to repay if you did not report your earnings and Social Security later discovered you earned above SGA while receiving benefits.

How do I request expedited reinstatement?

Contact your local Social Security office by phone at 1-800-772-1213 or in person. Tell them you want to request expedited reinstatement because your earnings have dropped below SGA or you have stopped working. Have your Social Security number and recent pay stubs or a letter from your employer ready. Social Security must decide within 60 days.

Does the new law change how much SSDI I receive each month?

No. The new law does not change your benefit amount. It only changes the income threshold at which Social Security considers you able to work, and it adds the expedited reinstatement option if you try working and then need to come back to SSDI. Your monthly payment stays the same.