Exploring Impairment-Related Work Expenses

In the event you are significantly unable to provide for yourself due to a medical condition, the Social Security program offers two types of monthly benefits for financial support: Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI). These two types of income, however, can be affected based on your need for impairment-related work expenses (IRWE).

Impairment-related work expenses, according to Social Security, are unreimbursed costs that people with disabilities incur to make it possible for them to work. This could include transportation costs to the office or the expenses for a guide dog. These expenses could affect a person’s eligibility in receiving disability benefits. Social Security is providing several incentives to encourage people with disabilities to return to the workforce. One of these incentives is the SGA Test, which allows SSI and SSDI recipients to subtract those impairment-related work expenses from their income to determine benefit eligibility.

What is considered IRWE?

To qualify as an impairment-related work expense, any product or service must meet a certain type of criteria:

• You must need the product or service in order to work.
• Your need must be due to a physical or mental disability.
• You paid for the product or service yourself. If any portion of the cost was covered by another source (Medicare, Medicaid, etc.), it cannot be considered IRWE.
• The cost is “reasonable”, i.e., what you pay for the product or service is the standard charge for where you live.

What are the different types of IRWE?

Social Security uses a resource called The Red Book (available in English and Spanish) that provides examples of goods and services that can be categorized as IRWE. Some common examples that can be deducted from your income as IRWE include transportation, medical services and devices, attendant care and service animals, home modifications and assistive technology.

Goods and services that you use in your everyday life can also be classified as IRWE. If you use a hearing aid at home, for example, and you use that same hearing aid while you are working, that hearing aid can be considered IRWE. Items that are covered by insurance, however, cannot be considered IRWE, though the cost-sharing expenses for these items may be counted.

What does this mean for recipients?

Simply put, as the recipient, you will still be able to receive disability benefits while working for pay, depending on certain limits. One of the determining limits is what Social Security refers to as the “substantial gain activity” (SGA).

What is Substantial Gain Activity?

SGA is additional income that you receive from employment. If you are an SSDI recipient and receive income above a certain level, Social Security classifies that income as “substantial gainful activity.” Depending upon the level of your SGA, you can be deemed ineligible to receive SSDI. The reason why Social Security imposes this type of limit on recipients is to provide financial support to people who cannot support themselves due to a medical condition. Social Security’s reasoning is if you are able to perform “substantial” work, by definition, you are not disabled.

What is the SGA test?

The SGA test is applicable for all applicants and current recipients of SSDI. Regarding SSI, the SGA test is only applicable at the filing stage. This means that if your work income exceeds the SGA limit at the time that you file for benefits, you will be denied SSI. If you are currently receiving SSI, however, the SGA limit does not apply but you will be subject to separate limits on income. If you are a self-employed recipient, Social Security will apply your net income to the limit, along with other measures of work activity.

How does IRWE affect benefits?

The current limit for the SGA Test is $1,310 a month. If you suffer from a disability such as blindness, your limit is 2,190 dollars. Social Security uses the cost of impairment-related work expenses in a way to offset the SGA Test limit. If Social Security discovers that you are engaged in substantial gainful activity, your impairment-related work expenses can be deducted from your gross income. If your earnings fall below the limit after the deduction, you can still be eligible for benefits.

Disabled people who receive SSI can also use impairment-related work expenses to their advantage. Similar to SSDI, the SSI imposes its own set of earnings limits. For recipients who have income only from work, the limit is set at $1,673 a month. Just with SGA, the expenses directly related to your ability to work can be deducted from the SSI earnings cap, helping to maintain your eligibility.

Do you have questions about SSDI or IRWE? The experienced Maryland Social Security Disability attorneys at Plaxen Adler Muncy, PA can answer your questions and help you file a claim. Call our office at 410-730-7737, or complete a contact form to schedule a consultation at one of our multiple offices throughout the state.