Most SSDI recipients do not file federal income taxes, but you may have to depending on other income you receive
Social Security Disability Insurance (SSDI) payments themselves are usually not taxable income. However, if you have other income — from work, investments, pensions, or other sources — you may be required to file a federal tax return even if SSDI is your main source of money. The rule depends on how much non-SSDI income you earn in a year, not on the SSDI amount itself.
The Internal Revenue Service (IRS) sets a threshold each year. If your total income from all sources falls below that threshold, you do not have to file. If it exceeds the threshold, you must file, even if no taxes are owed. Some people file anyway because they are owed a refund from taxes withheld on other income.
Key Takeaways
- SSDI payments are not counted as taxable income by the IRS, so SSDI alone does not trigger a filing requirement.
- You must file if your income from work, pensions, interest, dividends, or other non-SSDI sources exceeds the annual threshold set by the IRS.
- The income threshold varies by age and filing status and changes each year; for 2024, a single person under 65 must file if earned income exceeds $14,600.
- If you work part-time or have investment income, you should calculate your total non-SSDI income to determine whether filing is required.
- Filing a return can result in a refund even if you owe no tax, so some SSDI recipients file voluntarily.
How the IRS counts income when you receive SSDI
The IRS treats SSDI as a non-taxable benefit, similar to Supplemental Security Income (SSI). This means SSDI payments do not count toward the income threshold that determines whether you must file. Only income from other sources — wages, self-employment, interest, dividends, rental income, pensions, and certain other payments — counts.
If SSDI is your only income for the year, you do not file a federal tax return. You can receive SSDI and have zero tax filing obligation. This applies regardless of how much SSDI you receive in a year.
The rule is the same whether you receive SSDI as a disabled worker, a widow or widower, or a child of a disabled or deceased worker. The source of the SSDI does not change its tax treatment.
Income thresholds for 2024 and how they work
The IRS sets different thresholds based on your age and filing status. These thresholds change each year. For 2024, a single person under age 65 must file if earned income (wages or self-employment) exceeds $14,600. A single person age 65 or older must file if earned income exceeds $18,600.
If you have unearned income — interest, dividends, capital gains, or rental income — the threshold is lower. For 2024, a single person under 65 must file if unearned income exceeds $1,550. A single person 65 or older must file if unearned income exceeds $4,150.
If you have both earned and unearned income, you add them together and compare the total to a combined threshold. The IRS publishes updated thresholds each January. You can find the current year's thresholds on the IRS website or by calling the IRS at 1-800-829-1040.
Working while receiving SSDI and tax filing
If you work part-time or full-time while receiving SSDI, your wages are subject to income tax withholding. Your employer withholds federal income tax from your paycheck based on the W-4 form you complete. This withholding is separate from the SSDI payment and does not affect your SSDI amount (though work can affect your SSDI benefits under other rules).
You must file a tax return if your total wages exceed the threshold for your age and filing status. Even if you earn less than the threshold and owe no tax, you may want to file because your employer withheld tax from your paychecks. Filing allows you to claim a refund of that withheld amount.
If you are self-employed while receiving SSDI, you must file if your net self-employment income exceeds $400 for the year, regardless of your age or other income. Self-employment income is also subject to self-employment tax (Social Security and Medicare tax), which is separate from income tax.
Other income sources that trigger a filing requirement
Interest from savings accounts, money market accounts, and certificates of deposit counts as unearned income. Dividends from stocks and mutual funds count as unearned income. If your total unearned income exceeds the threshold for your age, you must file.
Rental income, capital gains from selling property or investments, pension payments, and distributions from retirement accounts (such as IRAs or 401(k)s) also count as income for filing purposes. Each of these is added to your total when determining whether you exceed the threshold.
Certain other payments — such as unemployment benefits, workers' compensation, or jury duty pay — may be taxable and must be counted. If you are unsure whether a particular payment is taxable, the IRS publication 525 (Taxable and Nontaxable Income) lists the rules for most common income sources.
What happens if you do not file when you should
If you are required to file and do not, the IRS may assess a penalty. The penalty is usually a percentage of the unpaid tax, though if no tax is owed, the penalty may be waived. The IRS can also delay processing refunds or other benefits if you have unfiled returns.
If you realize you should have filed in a prior year, you can file a late return. There is no time limit to file if you are owed a refund. If you owe tax, you should file as soon as possible to minimize penalties and interest.
If you have questions about whether you should have filed in a prior year, you can contact the IRS at 1-800-829-1040 or visit an IRS office. Many communities also have free tax preparation services for people with low to moderate income.
Filing voluntarily even if not required
Some SSDI recipients file a tax return even though they are not required to. This is common when an employer withheld federal income tax from wages and the person is owed a refund. Filing allows you to claim that refund.
Filing can also be useful if you want to claim the Earned Income Tax Credit (EITC), a refundable credit for people with low earned income. If you work part-time and your income is low enough, you may be owed an EITC refund even if no tax was withheld. You must file to claim it.
You can file using IRS Free File (if your income is below a certain level), through a tax professional, or by mailing a paper return to the IRS. The IRS website has a tool to help you determine which filing method works for you.
Frequently Asked Questions
Do I have to report my SSDI income on a tax return?
No. SSDI is not taxable income, so you do not report it on your tax return. You only report income from other sources — wages, self-employment, interest, dividends, pensions, and similar payments. If SSDI is your only income, you have no income to report and do not file.
What if I work part-time and receive SSDI?
Your wages are taxable income and must be counted when determining whether you exceed the filing threshold. If your wages plus any other income exceed the threshold for your age and filing status, you must file. You should also check whether your work affects your SSDI benefits under the Social Security work incentive rules.
Can I get a refund if I file even though I do not owe tax?
Yes. If your employer withheld federal income tax from your wages, you may be owed a refund. Filing a return allows you to claim that refund. You may also be owed a refund if you may have access to for the Earned Income Tax Credit or other refundable credits.
Where do I find the income threshold for my situation?
The IRS publishes income thresholds each January on its website (irs.gov). The threshold depends on your age, filing status, and whether your income is earned or unearned. You can also call the IRS at 1-800-829-1040 to ask about the current year's threshold for your situation.
What if I missed filing in a prior year?
If you are owed a refund, you can file a late return at any time. If you owe tax, file as soon as possible to reduce penalties and interest. The IRS does not have a time limit to assess tax if you did not file, so it is better to file late than not to file at all.