You may have to file taxes even though you receive disability benefits
Whether you file taxes depends on how much income you have from all sources combined, not on whether you receive SSDI. Social Security counts as income for tax purposes, but the threshold for filing is usually higher than your benefit amount alone. If you have other income — wages from work, interest, self-employment earnings, or rental income — you may cross the filing threshold and owe taxes.
The IRS sets different income thresholds based on your age, filing status, and type of income. For 2024, a single person under 65 must file if their gross income exceeds $14,600. If you are 65 or older, the threshold is $18,150. These numbers change each year. The key is that SSDI itself does not automatically trigger a filing requirement — your total income does.
Even if you do not owe taxes, filing can be worth doing. If you had taxes withheld from other income or paid estimated taxes, you may receive a refund. Some people on SSDI also claim the Earned Income Tax Credit (EITC) if they work, which requires filing a return to claim it.
Key Takeaways
- You must file taxes if your total income from all sources exceeds the IRS threshold for your age and filing status, regardless of whether you receive SSDI.
- SSDI benefits themselves are not taxable unless you have other income that pushes you over a combined income threshold set by the IRS.
- If you work while on SSDI, you may have to file taxes on your wages even if your SSDI benefit is small.
- Filing a tax return can result in a refund if taxes were withheld from your wages or if you are may have access to to credits like the Earned Income Tax Credit.
How the IRS counts SSDI in your income
The IRS uses a formula called combined income to determine whether any of your SSDI is taxable. Combined income is calculated as your adjusted gross income plus nontaxable interest plus half of your SSDI benefit. This formula exists because SSDI is only partially taxable — you do not pay tax on the full amount.
If your combined income is below $25,000 (single) or $32,000 (married filing jointly), none of your SSDI is taxable. If it is between $25,000 and $34,000 (single) or $32,000 and $44,000 (married), up to 50 percent of your SSDI may be taxable. If it exceeds those amounts, up to 85 percent may be taxable. These thresholds have not changed since 1993 and do not adjust for inflation.
The income that pushes you over these thresholds usually comes from wages, self-employment, pensions, or investment income — not from SSDI itself. If SSDI is your only income, you almost certainly will not owe tax on it.
When you work and receive SSDI
If you work while receiving SSDI, you have two separate obligations: you may owe income tax on your wages, and you must report your work to Social Security to avoid overpayments. These are different requirements handled by different agencies.
Your wages count toward the IRS income thresholds. If you earn $15,000 in wages and receive $12,000 in SSDI, your combined income is $27,000 — above the $25,000 threshold for a single person. This means some of your SSDI becomes taxable, and you will likely owe income tax. You must file a return to report the wages and calculate the tax.
Social Security also has a separate earnings limit. During 2024, if you are under full retirement age, Social Security reduces your benefit by $1 for every $2 you earn above $23,400. This is not a tax — it is a benefit reduction. You must report your earnings to Social Security even if you do not owe income tax. The two systems do not communicate automatically, so you are responsible for reporting to both.
Filing requirements based on your specific situation
Your filing requirement depends on which of these categories fits you:
| Your situation | Filing requirement |
|---|---|
| SSDI only, no other income, under 65 | File only if you want to claim a refund for taxes withheld elsewhere |
| SSDI plus wages | File if total income exceeds $14,600 (single, under 65) |
| SSDI plus self-employment income | File if net self-employment income is $400 or more, regardless of other income |
| SSDI plus interest, dividends, or rental income | File if combined income exceeds $25,000 (single) |
| Age 65 or older, SSDI only | File only if you want to claim a refund for taxes withheld elsewhere |
Self-employment income has its own rule. If you have net self-employment income of $400 or more in a year, you must file a tax return even if your total income is below the standard threshold. This is because you owe self-employment tax (Social Security and Medicare tax) on that income, separate from income tax.
Documents you need to file your return
Gather these documents before you file:
- SSA-1099-B — Social Security sends this form in January if you received SSDI during the previous year. It shows your total benefit amount for the year.
- W-2 — Your employer sends this if you worked. It shows wages and taxes withheld.
- 1099 forms — You receive these for self-employment income (1099-NEC), interest (1099-INT), dividends (1099-DIV), or rental income (1099-MISC or Schedule E).
- Records of estimated tax payments — If you paid estimated taxes during the year, gather the confirmation notices.
- Proof of health insurance — You do not need to attach this, but keep it in case the IRS asks.
The SSA-1099-B is critical. It is the only document that proves to the IRS how much SSDI you received. Do not file without it. If you do not receive one by early February, contact Social Security at 1-800-772-1213 to request a replacement.
How to file your return
You have three main options: file on your own using tax software, file by mail, or work with a tax professional.
Tax software: Programs like TurboTax, H&R Block, and TaxAct walk you through questions about your income and automatically calculate whether you owe tax. Most have free versions if your income is below a certain threshold. You enter your SSA-1099-B information the same way you would enter a W-2. The software calculates your combined income and determines whether any SSDI is taxable.
Paper filing: You can read Form 1040 and Schedule 1 from IRS.gov and mail them to the address listed in the instructions. This is slower — processing takes 4 to 6 weeks — but requires no software or internet access. You must calculate your combined income and taxable SSDI yourself using the IRS worksheet in the Form 1040 instructions.
Tax professional: A CPA or tax preparer can file for you. Many offer free or low-cost services through the IRS Volunteer Income Tax information (VITA) program if your income is below $64,000. You can find a VITA site near you at IRS.gov or by calling 211.
The important date to file is April 15 each year. If you cannot file by then, you can request an automatic extension by filing Form 4868, which gives you until October 15. The extension gives you more time to file, but not more time to pay — taxes owed are still due April 15.
What happens if you do not file when you should
If you owe taxes and do not file, the IRS charges penalties and interest. The failure-to-file penalty is 5 percent of the unpaid tax for each month the return is late, up to 25 percent. Interest accrues daily at a rate set quarterly — for 2024 it is 8 percent per year. These charges compound, so a small tax bill can grow quickly.
If you do not owe taxes but should have filed to claim a refund, you have three years from the original due date to file and claim it. After three years, the refund is forfeited. This is why filing even when you do not owe can be worthwhile — you may be leaving money on the table.
If you realize you should have filed in a previous year, file as soon as you can. The IRS is usually willing to work with people who file late voluntarily. Bring all documents you have and explain why you did not file. If you owe, ask about a payment plan — the IRS allows installment agreements for amounts under $50,000.
Frequently Asked Questions
Is SSDI taxable income?
SSDI is only taxable if your combined income exceeds certain thresholds set by the IRS. Combined income includes half your SSDI benefit plus all other income. For a single person, if combined income is below $25,000, none of your SSDI is taxable. If it exceeds that, up to 85 percent may be taxable. Most people on SSDI alone do not owe tax on their benefits.
Do I have to file taxes if I only receive SSDI and no other income?
No, you do not have to file if SSDI is your only income. However, you may want to file anyway if you had taxes withheld from other income during the year or if you are may have access to to a refundable credit. Filing takes about 20 minutes with tax software and could result in a refund.
What if I worked part of the year and received SSDI?
You must file if your total income exceeds the threshold for your age and filing status. For 2024, that is $14,600 for a single person under 65. Your wages plus half your SSDI benefit count toward this threshold. You will likely owe income tax on your wages, and possibly on part of your SSDI as well.
Can I file my taxes online if I receive SSDI?
Yes. Tax software programs accept SSA-1099-B forms the same way they accept W-2s. You enter the information from your SSA-1099-B, and the software calculates whether any of your SSDI is taxable. Most free versions support SSDI recipients.
What if I disagree with the amount shown on my SSA-1099-B?
Contact Social Security directly at 1-800-772-1213 to report the error. Do not file your tax return until the SSA-1099-B is corrected — filing with incorrect information can trigger an IRS notice later. Social Security can issue a corrected form (SSA-1099-B-C) if the original was wrong.