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Return to Work Programs for Individuals Receiving Title II SSDI Benefits: Part II: Extended Period of Eligibility

In Part I of this multi-series blog post we discussed that the Social Security Administration offers a variety of return to work incentive programs for you to try returning work without losing your benefits. Trial Work Period (TWP) was the focus of the last post. This month we discuss the Extended Period of Eligibility.

Extended Period of Eligibility

The month after the Trial Work Period (TWP) ends, the Extended Period of Eligibility (EPE) begins and continues for the following 36 months whether or not work continues.

For any month during this period that a person’s countable earned income is less than the Substantial Gainful Activity (SGA) level ($1470 for 2023), they continue to receive their SSDI benefit check. However, the first time after the TWP ended that earnings rose above the SGA level, Social Security will plan to stop benefits, but allow the person to receive a check for that month and the following two months as a “grace period” before stopping checks.

If after cessation begins, the person’s countable earned income again falls below the SGA in any of the EPE months, the individual will be entitled to SSDI benefits again. It is so important to REPORT any earnings to Social Security.

*Medicare eligibility is NOT impacted during the EPE, however, if no cash benefit is paid the individual will be billed quarterly for that monthly payment by the Center for Medicare Services.

*Benefits CANNOT be terminated during the EPE, only temporarily ceased. Benefits will be terminated the first month after the EPE ends where the person performs SGA. Therefore, the “grace period” discussed above, may occur during or after the EPE depending on when the first month of SGA occurs.

So, when are benefits terminated?

Benefits are terminated when countable earnings are above SGA level after 36 months have passed (month 43) if the grace period has already been used. If the grace period has not been used then the termination and cessation month are one and the same.

Countable Income

Countable income is earnings that reflect a person’s own work effort and productivity.

  • Sick and vacation pay – not countable income
  • Bonus and incentive pay – counted unless evidence shows it is not related to productivity
  • Cafeteria/Flex Spending Plan – are added back into the gross earnings calculation before SGA determination

Countable income is the portion of income that remains after Social Security work incentive programs are applied.

  • Income Averaging

Income may be averaged to reduced countable income below SGA if: 1) pattern of work is/was continuous, and 2) no significant change in work patterns or earnings, and 3) no change in SGA earnings levels during the period involved. *May not be used after the cessation month to determine payment months during EPE.

  • Unsuccessful Work Attempt

An effort to substantial work in employment or self-employment which is discontinued or reduced to the non-SGA level after a short period of time (no more than six months) because of the individual’s impairment or the removal of special conditions related to the impairment(s) that are essential to the continued performance of work.

  • Impairment Related Work Expenses

An expense for an item or service that 1) enables a person to work, and 2) is necessary because of a physical or mental impairment, and 3) is paid for by the recipient. *Must be paid for during the month of the work activity and cost must be reasonable. It must be approved by SSA.

  • Subsidy and Special Conditions

SSA uses earnings that reflect the real value of the work performed to determine SGA. IF the person is paid more than the value of the work, there may be a subsidy or special condition in place. If the individual has fewer duties than others doing the same work, there may be a special condition or subsidy in place. A letter from the employer documenting the subsidy will be accepted by SSA.

Circumstances that suggest a subsidy or special condition include:

  • Sheltered employment
  • mental impairment or disability starting in childhood
  • discrepancy between amount of pay and value of services compared to others
  • unusual help from others
  • government-sponsored jobs/training, particularly for those with disabilities.

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