The terms "Countable Income" and "Countable Earnings" as they apply to Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) can be very confusing because the terms are used in different ways depending on which benefit is involved and the type of calculation being discussed.
We will attempt here to explain the differences among:
· "Countable Earnings" for Determining SGA
· "Countable Earnings" and "Countable Income" for Calculating the SSI Cash Benefit Amount
· "Countable Income" for Self-Employed Individuals
When the Social Security Administration (SSA) decides whether or not you have engaged in – or are engaging in – Substantial Gainful Activity (SGA), it compares your "Countable Earnings" to the SGA level for that year. If your "Countable Earnings" exceed the SGA level, then SSA determines that you are engaged in Substantial Gainful Activity.
If you are employed by someone else, then your "Countable Earnings" for this purpose are your gross wages or salary (including tips and commissions) minus any Impairment Related Work Expenses (IRWEs) and minus any Subsidies and Special Conditions.
If you are self-employed, your "Countable Earnings" are your "Countable Income" as defined below.
In the SSI program, an SGA decision affects only your initial eligibility. (See SGA - SSI.)
In the SSDI program, an SGA decision can affect your initial eligibility, the payment of your cash benefit during your Extended Period of Eligibility (EPE) (after your Trial Work Period and Grace Period), and your termination from the program at the end of your EPE. (See SGA - SSDI).
For purposes of calculating the SSI Cash Benefit Amount, your "Countable Income" includes:
· Countable Unearned Income: Unearned income that is not excluded by law or by the General Income Exclusion;
· Countable Earned Income: Earnings after subtracting the the Earned Income Exclusion and any Impairment Related Work Expenses (IRWEs) or Student Earned Income Exclusion (SEIE) and/or Blind Work Expenses (BWEs)
From the sum of those two amounts is subtracted any Plans for Achieving Self-Support (PASS). (See Countable Income - SSI for details of figuring the Countable Income. See Calculating SSI Cash Benefit Amount for more information about the cash benefit calculation.)
When determining if a self-employed individual is engaging in SGA, one of the tests is whether or not the person's "Countable Income" exceeds the SGA level. (See Self-Employment Income and SGA for an explanation of the three tests.)
For this purpose, "Countable Income" is the net income from the business reduced by deducting such things as the value of any significant amount of unpaid help furnished the individual, impairment –related work expenses (if not already deducted as a business expense), Unincurred Business Expenses paid by someone other than the self-employed individual (as well as the value of things provided, and soil bank payments if they were included as farm income.
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