Understanding Substantial Gainful Activity (SGA)

Substantial Gainful Activity (SGA) is the primary benchmark used by the Social Security Administration (SSA) to determine whether you are capable of engaging in meaningful work and, therefore, whether you continue to qualify for Social Security Disability Insurance (SSDI) benefits. If your countable earnings exceed the designated SGA threshold, the SSA may decide that you are no longer eligible for SSDI benefits, or your benefits could be paused or terminated. Understanding how SGA works is critical for SSDI recipients, as it plays a significant role in determining ongoing eligibility and ensuring you are receiving the correct benefits.

The SGA limit is an income threshold that defines whether you are working at a level that SSA considers to be "substantial." In 2025, the SGA limit is set at $1,620 per month for most individuals. This means that if your countable monthly earnings exceed this amount, the SSA might determine that you are no longer disabled, as you would be deemed capable of substantial work. However, if you are legally blind, the SGA limit is increased to $2,700 per month. This higher threshold acknowledges the additional barriers that blind individuals may face in the workplace.

It's essential to understand that earning above these limits—even part-time—can jeopardize your eligibility for SSDI benefits. If your income exceeds the SGA limit in any month, even if it's a temporary or part-time job, your eligibility for benefits could be affected. However, it’s not enough to just monitor your income—proper reporting and taking advantage of deductions can play a role in ensuring that you don’t lose benefits unintentionally. Keeping track of your earnings and any changes in work activities is crucial for maintaining eligibility.

Trial Work Period (TWP) Explained

The SSA offers a Trial Work Period (TWP) that allows SSDI beneficiaries to test their ability to work without losing their benefits immediately. This program is designed to encourage individuals to return to work and regain self-sufficiency without the fear of instantly losing SSDI support. The TWP provides an opportunity to work and see if you can handle employment without adversely affecting your disability benefits. During this period, you can earn above the SGA limit and still continue to receive full SSDI benefits.

In 2025, any month in which you earn more than $1,110 counts as a TWP month. The SSA allows up to nine TWP months within a rolling 60-month window. It’s important to note that these nine months do not have to be consecutive, meaning you can use them over several years. The TWP allows you to test your work capabilities without the risk of losing your benefits during the trial period. Even if you earn a significant income during a TWP month, it will not affect your eligibility for SSDI benefits as long as the month counts toward one of your nine trial months.

The key here is to ensure accurate reporting of your income and work activity. If you earn over the threshold in a particular month, but the month counts as one of your TWP months, your benefits will remain intact, regardless of how much you earn. Once you have used up your nine TWP months, you will enter the next phase, known as the Extended Period of Eligibility (EPE), which allows you to continue receiving SSDI benefits under certain conditions, even if your earnings exceed the SGA limit.

Extended Period of Eligibility (EPE)

Once the Trial Work Period (TWP) has ended, you will enter the Extended Period of Eligibility (EPE), which lasts for 36 months. During this period, you may continue to receive SSDI benefits if your monthly earnings fall below the SGA limit. The EPE is a safeguard for individuals who are attempting to re-enter the workforce and are still adjusting to earning a living wage. The benefit of the EPE is that it provides an extended window of time in which you can test your ability to sustain gainful employment while still receiving SSDI if your earnings are below the SGA threshold.

If your earnings exceed the SGA limit during any month of the Extended Period of Eligibility, your SSDI benefits may be suspended rather than terminated. This means that your benefits will not stop completely; instead, they will pause for the months when your earnings exceed the limit. Benefits will automatically resume if your earnings fall below the SGA level in later months, and you remain within the 36-month EPE window. This allows you to continue receiving benefits during times when you may not be able to maintain a certain level of work, providing additional stability during your return to the workforce.

The EPE provides a safety net to help people transition back into employment without risking a permanent loss of benefits. It offers more flexibility than the TWP and gives you additional time to find a balance between work and your medical condition. However, it’s essential to track your earnings and report them accurately, as even a small fluctuation in your income can affect whether your benefits will be suspended or continued.

What Income Counts Toward SGA?

Not all income is counted toward the SGA limit. However, it’s important to know that the SSA considers various types of income as part of the SGA calculation. These include wages from employment, net self-employment profit, and income from tips, bonuses, or commissions. All of these income types are considered when determining whether your work is deemed substantial enough to affect your eligibility for SSDI.

There are also deductions available that can reduce your countable income, making it less likely that you’ll exceed the SGA limit. One such deduction is for Impairment-Related Work Expenses (IRWEs), which are expenses that are necessary for you to work due to your medical condition. These expenses may include adaptive devices, transportation costs, or medications that are essential for your employment. If you incur such expenses, you may deduct them from your total income, reducing your countable earnings for SSA purposes.

Additionally, wage subsidies or accommodations from an employer that are provided to assist with reduced productivity may also be deducted from your countable income. These accommodations can help offset the effects of a disability on your ability to work and may include things like modified work hours or special equipment. It’s important to document these deductions clearly, as SSA requires detailed proof of any qualifying expenses or accommodations in order to reduce your countable income under their guidelines.

Income That Does Not Count Toward SSDI Limits

Certain types of income are excluded from the SGA calculation, which means they will not impact your eligibility for SSDI benefits. For example, unearned income such as retirement benefits, disability insurance payments, veteran benefits, or passive investment income (such as dividends or rental income) does not count toward SGA. Additionally, gifts or child support, depending on how they are classified, are typically excluded from the SGA calculation.

While these types of income do not affect SSDI eligibility, it’s still important to track them accurately. Although they are not counted as part of the SGA calculation, they may still have an impact on your financial records and may be requested during any SSA review of your income or benefits. Keeping detailed records of all income sources is crucial for ensuring that your SSDI status remains in good standing.

Another important exclusion is income from self-employment that is passive, meaning it is not related to active involvement in a business. For instance, if you are receiving income from an investment or a rental property but are not actively involved in managing it, that income will not count against the SGA limit. However, if you are actively working in your self-employment business, such as providing services or managing the operation, that income will be considered when calculating SGA.

Rules for Self-Employed Beneficiaries

Self-employed individuals face different rules for determining their eligibility for SSDI. The SSA evaluates self-employment differently than traditional employment and uses two primary tests to assess whether the self-employed person’s earnings exceed the SGA limit. The first test is the comparability of work test, which looks at whether your current self-employment activity is similar in skill and responsibility to the work you did in the past. The second test is the worth-of-work test, which assesses whether the value of your labor to your trade or the public exceeds what SSA considers acceptable.

Proper documentation is critical for self-employed beneficiaries. The SSA requires self-employed individuals to provide detailed records of their work, such as timesheets, ledgers, and profit-and-loss statements. These records must clearly demonstrate that the work you are doing is not comparable to past employment or that the income you are earning is below the SGA threshold. Without proper documentation, it can be difficult to prove that your self-employment income does not count toward the SGA limit, and you could risk losing your benefits.

Unsuccessful Work Attempts (UWA)

An Unsuccessful Work Attempt (UWA) is a situation where you try to work, but due to your disability or the loss of required accommodations, you are unable to continue working. If you attempt work and it ends within six months for these reasons, the SSA may classify it as an unsuccessful work attempt, meaning that any earnings from that attempt will not be counted against you. This is important because it allows beneficiaries to try working again without risking permanent loss of SSDI benefits if the effort is unsuccessful.

For a work attempt to be considered unsuccessful, you must provide appropriate documentation, such as medical records or employer statements, explaining why the work attempt was unsuccessful. The SSA understands that certain medical conditions can fluctuate, and a person may not be able to maintain a job despite a sincere effort. As long as the work attempt meets the criteria for an Unsuccessful Work Attempt and is properly documented, the earnings from that attempt will not affect your SSDI eligibility.

Reporting Requirements in Alabama

To ensure that your benefits are not interrupted, it is vital to report your earnings and work activity to the SSA. This includes reporting any changes in your employment, job duties, or hours worked, as well as any Impairment-Related Work Expenses (IRWEs) or accommodations from your employer. It’s also necessary to report any changes in self-employment profits, as these can affect your countable income.

Best practice is to report your earnings within 10 days after the end of each month to keep your information up to date and avoid any issues with your SSDI benefits. It is also essential to keep detailed records of all your work activity, including pay stubs, tax documents, and reports of any accommodations or expenses that may be deducted. Clear and accurate reporting is the key to maintaining your SSDI benefits without disruption.

How to Avoid Benefit Disruptions

To avoid disruptions in your benefits, it’s best to keep your monthly earned income under the SGA threshold of $1,620 (or $2,700 if you are legally blind). This can help ensure that you do not inadvertently exceed the limits that would affect your eligibility for SSDI benefits. It’s also important to track your Trial Work Period (TWP) months and ensure you do not exceed the nine TWP months within the 60-month window. Additionally, documenting any qualifying work-related expenses for IRWE deductions can help reduce your countable income, potentially allowing you to stay below the SGA limit.



It’s also essential to always report your work activity, even minor changes in hours, duties, or income. By staying proactive and reporting all relevant information to the SSA, you can avoid unexpected interruptions to your benefits. Utilizing resources like the Ticket to Work program can also be helpful, as it offers guidance and support for individuals returning to work while receiving SSDI benefits.