It Doesn’t Take a Rocket Scientist:
To Understand & Use Social Security Work Incentives
Subsidy
Subsidies apply to SSDI/DAC beneficiaries and in limited
circumstance also to SSI recipients. The dollar amount of subsidies
is subtracted from gross monthly earnings of the person. If
the amount of subsidy is large enough, it will reduce countable
earnings below SGA. For SSI, subsidies only apply at application
if there are wages being evaluated for SGA. For SSDI/DAC recipients,
however, subsides apply anytime SGA is a consideration.
Subsidies exist in a job when employers pay workers with disabilities
more in wages than the reasonable value of the actual services
performed, therefore subsidizing them. To qualify, the person
must produce less when compared to the typical worker (employer
will document this on the SSA Work Activity Questionnaire, provided
by the local SSA office), need extra support or supervision,
have fewer or easier duties, more rest periods, special equipment
or transportation, fewer hours, irregular hours, or frequent
absences, etc.
Subsidies
can be either specific or non-specific. Specific subsidies
include a specific dollar amount of subsidy after calculating
the reasonable
value of the worker’s services. In non-specific subsidies,
the employer determines the amount by comparing the person’s
work to that of a typical employee in terms of time, skills,
and job responsibilities at the workplace. This is noted as a
percentage against the prevailing wage for the job. The employer
then assigns a percentage amount to the disabled employee’s
work.
Note: Job coach services provided to employees
are an indication that the work is subsidized. If an employer
cannot furnish a satisfactory explanation identifying the specific
amount of subsidy, look at:
1. The time, energy, skills, and responsibilities
of the worker with a disability compared to the typical worker
being paid the same money;
2. An estimation of the proportionate value
of work accomplished compared to the amount of pay; and/or
3.The frequency with which the job coach monitors
the person and how intensively involved the job coach remains.
The following may be indicators of possible employment subsidies:
• Childhood disability;
•Mental health disability;
• Discrepancy between amount paid and work done (e.g. fewer duties than typical workers);
• Nature and severity of impairment indicate that the person receives help from others in doing the work;
• Training or employment programs.
Subsidies apply in self-employment when:
• The person has un-incurred business expenses (e.g., unpaid help in business management, tax preparation, volunteer labor, etc.);
• The person receives Soil Bank Payments (farmers/ranchers); or
• The person's effort to provide a service
or produce a product is not equal to what the standard
in the
community is for that type of business.
Whenever subsidies exist for working SSDI/DAC beneficiaries, SSA will
reduce their gross monthly earnings (or net income for self-employment)
by the amount of the subsidies. This often means that Social Security will
then view the earnings as below SGA. When earnings are “seen” by
SSA as being below SGA (even though the numbers on the paycheck are higher),
SSDI checks and Medicare coverage continue.
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