Wednesday, December 23, 2009

A Word of Caution about SSI

If you receive SSI and not just Social Security Disability (SSDI) and you start working from home as being self-employed, the Social Security Administration calculates your self-employment earnings from the beginning of the year. So, if you started working from home in July (or any other month), the SSA treats it as if you have started working from home in January.

Therefore, they can decide that you need to repay the SSI you received during the months that you weren't working. For example, I started working from home in July. I reported my income in July. They decided that I should no longer get SSI since my work from home limit was above their monthly income limit for SSI. I was totally fine with that since I make much more from home than my small SSI check.

What I was not prepared for was the letter that I received a few months later that said that I owe the Social Security Admnistration the SSI money that I received from January-July. Granted, a person can appeal this or claim hardship. Even if the person does not appeal the decision or claim hardship, when the person files their income tax the following year, the amount is calculated for the year. If the amount calculated from the income tax shows that the person did not make enough to have the SSI taken back for the year, the Social Security Administration may return some or all of the money that was paid back.

Obviously, this is not logical. You would think that the SSA would use the person's start date to do their calculations for SSI. It's just another example of how the Social Security Admnistration makes it more difficult for people who need to work from home due to anxiety disorders like agoraphobia.

So, if you work from home instead of having a traditional job, you will have to pay back the SSI from the beginning of the year if the SSA decides you no longer qualify for SSI. Also, people who work from home who are on SSI or SSDI can only work 45 hours a month. People who work outside the home can work more hours. (Again, I don't see the logic in that at all. I think it should be a straight income limit for everyone.)

If ANYONE understands the logic for these SSA practices, please share!
I am not an authority on SSA practices. Please contact the SSA and discuss your case and situation if you have any questions.

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