Substantial Gainful Activity (SGA): Meaning and Examples
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Table of Contents
Table of Contents
Substantial gainful activity (SGA) is a term to describe significant physical and/or mental effort performed in exchange for wages or intended profit. The Social Security Administration uses SGA to help determine whether a person is eligible for Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI).
Understanding what counts as SGA and how it affects SSDI and SSI eligibility is essential if you’re seeking or receiving benefits.
2023 and 2024 SGA limits
People receiving SSDI or SSI who earn more than the monthly SGA limit may lose their benefits. The SGA limits change every year to account for inflation and are higher for people who are blind .
Benefit | Monthly SGA limit, blind | Monthly SGA limit, nonblind |
|---|---|---|
2023 | ||
SSDI | $2,460. | $1,470. |
SSI | No limit. | $1,470. |
2024 | ||
SSDI | $2,590. | $1,550. |
SSI | No limit. | $1,550. |
What counts as SGA?
Income that counts as SGA includes:
Wages: Earnings from employment, including salaries and hourly wages.
Self-employment: Income after deducting business-related expenses from running a business or being self-employed.
Royalties: Income from creative works, patents or intellectual property.
Bonuses and commissions: Extra compensation to reward performance or productivity .
What’s excluded from SGA?
Certain types of income are excluded from SGA calculations .
Impairment-related work expenses (IRWE): Costs that are necessary to enable a person with a disability to work, such as assistive devices, transportation and job coaching.
Blind work expenses (BWE): Expenses blind individuals incur to enable them to work, including service animal expenses or specialized transportation.
Subsidy and special conditions: Benefits received for supportive services such as counseling or therapy, as well as employer-provided “subsidies” that result in receiving more pay from an employer than the actual value of the services provided.
Student earned income exclusion (SEIE): For SSI recipients under 22 who are attending school, a portion of their earned income may be excluded from SGA calculations. The 2023 exclusion is $2,220 per month up to $8,950 per year in 2023; this increases to $2,290 per month up to $9,230 in 2024.
Plans to achieve self-support (PASS): Funds set aside for specific work-related goals, such as education, assistive technology or job training.
Unsuccessful work attempt (UWA): Work you stopped or reduced to below SGA after six months or fewer because of your impairment or the removal of special conditions related to your disability that helped you work.
VA benefits: Veterans disability benefits and other kinds of government assistance that don’t come from Social Security.
Passive income: Income from investments, rental properties or other sources that do not require active work generally do not count (although it may affect eligibility for SSI).
How is SGA reported?
The Social Security Administration receives information about your SGA through one of the following methods:
Self-reporting: If you are applying for disability benefits or are already receiving them, you are required to report your work and earnings to the SSA. This includes reporting any changes in work activity or income, such as starting a new job, an increase in work hours or changes in wages.
Work activity reports: A work activity report (Form SSA-821-BK), asks for details about the nature of the work, the number of hours worked and the earnings received.
Monitoring: The SSA conducts periodic reviews of people receiving disability benefits to determine if they are still eligible. During these reviews, you must provide information about your work activity and earnings, and the SSA may request additional documentation, such as pay stubs or employer statements.
How is SGA used to make decisions regarding monthly benefits?
Here's how SGA factors into certain key decisions regarding monthly benefits:
Initial eligibility determination: When you apply for disability benefits, the SSA reviews your application and medical evidence to assess your eligibility. One of the primary considerations is whether you are engaging in SGA. If your work activity and earnings exceed the SGA threshold, your application may be denied.
Trial work period (TWP): The SSA recognizes that people with disabilities may want to attempt to return to work without risking the immediate loss of their benefits. To encourage work, the SSA offers a trial work period (TWP). During the TWP, you can work and earn as much as you want for up to nine months during any 60-month period without affecting your disability benefits (the months are not necessarily consecutive).
Continuing disability reviews (CDRs): Individuals receiving disability benefits are subject to periodic CDRs to assess whether their medical condition has improved and whether they are still eligible for benefits. SGA is a key consideration during these reviews. If the SSA determines that your work activity and earnings demonstrate the ability to engage in SGA, you may lose your disability benefits .
Expedited reinstatement (EXR): If the Social Security Administration halts a recipient's benefits due to the SGA limit but the person’s medical condition worsens within five years, they may be eligible for expedited reinstatement of benefits without having to reapply. This allows individuals to resume their benefits quickly if they are unable to continue working due to their disability .
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