How Gig Economy Jobs Affect SSDI Eligibility
The gig economy, defined by short-term contracts or freelance work as opposed to permanent jobs, has steadily infiltrated the American workforce. Companies like Uber, DoorDash, and Freelancer have revolutionized the way people think about employment. But when it comes to the intersection between gig work and Social Security Disability Insurance (SSDI), things become murkier. This article explores how participating in the gig economy can affect SSDI eligibility and ongoing benefit status.
The Basics of SSDI
Before delving into the complexities, it’s crucial to understand the fundamentals of SSDI. The Social Security Administration (SSA) administers this program to provide financial support for people who cannot work due to long-term disabilities. One of the crucial eligibility criteria is the applicant’s inability to engage in “Substantial Gainful Activity” (SGA). SGA is measured in terms of monthly income and varies yearly; for 2023, it stood at $1,470 for non-blind individuals.
The Gig Economy and Substantial Gainful Activity
The SSA is explicit in defining what qualifies as SGA in traditional employment settings, but gig work, with its flexibility and variable income, poses a unique challenge. The gig economy can be particularly enticing for people with disabilities due to its often low physical demands and flexible hours. However, the sporadic and sometimes significant income generated through gig jobs can push an individual over the SGA threshold, thereby jeopardizing SSDI eligibility.
For example, an if an Uber Driver receiving SSDI benefits made over $1,470 in a month, which is the threshold for Substantial Gainful Activity, then that SSDI recipient would be at risk of losing his or her benefits, since that income demonstrates to the Social Security Administration that the individual may not require financial assistance.
Work Credits and the Gig Economy
Work credits, another cornerstone of SSDI eligibility, are calculated based on the number of years and quarters you’ve worked in jobs covered by Social Security. While gig economy companies usually don’t offer benefits like health insurance, they are generally required to report your earnings to the IRS, which means you accumulate Social Security work credits. Earning too many work credits, or not enough credits, may also impact your SSDI eligibility by altering your “Date Last Insured” (DLI), a critical date by which you must prove your disability began.
An individual can earn 4 work credits per year, which is measured by every $1,640 in that individual’s income. This can obviously be accomplished quickly through consistent work, or throughout the course of the year, with sporadic work. You must have at least 20 credits in the 10-year period immediately before your disability begins in order to qualify for social security disability benefits.
If you have managed to earn 4 work credits every year consistently, then that may signal to the Social Security Administration that you are not as in need of financial assistance as someone who has been unable to work in the previous ten years.
Gig Work and the Sequential Evaluation Process
Engaging in gig work while applying for SSDI places the spotlight on the second step of the SSA’s Sequential Evaluation Process—namely, the severity of your condition. If you’re earning money through gig work, the SSA may question the seriousness of your disability, which could necessitate additional medical proof or lead to a rejection of your application..
To read more about why a social security disability claim may be denied, then click here.
The Implications on Ongoing Benefits
If you’re already receiving SSDI and consider venturing into gig work, be cautious. The SSA has various work incentives, including the Trial Work Period (TWP), allowing you to test your ability to work for nine months. However, income generated during or after the TWP could disqualify you from further benefits if it crosses the SGA limit.
Disabilities vary in their severity, as much as freelance work varies in its demands; some people who qualify for disability benefits will be capable of offering rides, or delivering goods, or entering data from the comfort of their own home. As long as that work does not exceed the threshold of Substantial Gainful Activity or contradict your listed disability, then your benefits will not be compromised.
With the fluctuation of income that may be garnered through gig work, however, you may find yourself approaching that threshold sooner than you think. Be cautious to ensure that your benefits are not rejected.
What You Need to Know
Navigating SSDI eligibility while participating in the gig economy is a balancing act that necessitates thorough research and perhaps legal advice. With inconsistent incomes, flexible hours, and the absence of traditional employment benefits, gig work brings a set of challenges that can significantly impact your SSDI status. If you find yourself at this intersection, consulting with a disability lawyer experienced in the nuances of gig economy work can offer valuable guidance.