If I am self-employed, how do I calculate and report my income (net earnings) for SSDI?


If I am self-employed, how do I calculate and report my income (net earnings) for SSDI?

If possible, track and report Net Earnings from Self Employment (NESE) on a MONTHLY basis.

Are there deductions I can take to reduce my net earnings while self-employed?

Yes, you can deduct Unincurred Business Expenses, Unpaid Help, and Impairment Related Work Expenses.

Unincurred Business Expenses

  • Deduct the value of business expenses paid for by another person or agency
  • The deduction must meet the IRS definition of a business expense

Unpaid Help

  • Deduct the value of wages your business would have otherwise had to pay for

Impairment-Related Work Expenses

These are expenses you incur from the purchase or payment related to special equipment, training, and other items directly related to your ability to perform work with your impairment. It includes attendant care services, transportation costs that are impairment-related, medical devices, prostheses, work-related equipment or services such as typing aids, page-turning devices, telecommunications devices for the deaf, seeing eye dogs, medical supplies such as elastic stockings, catheters, incontinence pads

  • Documenting IRWE paid by the individual can lower countable income and preserve CDB.
  • Consult with Social Security prior to relying on IRWE to reduce countable income.
  • You must keep receipts of payment and submit them with paystubs to SSA every month.

Are there other ways I can manage my paycheck to reduce the effect of working on my SSI/SSDI and other benefits?

Yes. You can ensure that overtime does not negatively count against SSI/SSDI.

Another method is to watch the frequency of your paycheck (weekly hours vs. monthly paycheck). For SSI and SNAP benefits, wages (income) are counted when paid—a monthly paycheck is preferred to a bi-weekly or weekly paycheck that increases the total number of paychecks received.

If you have SSDI, your wages are counted when earned, which requires a calculation of your earnings for the month.

Additional Resources

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FD/MAS Alliance is a recipient of the Financial Advocacy in RARE Impact Grant sponsored by Global Genes.  Thanks to this award, FD/MAS Financial Literacy 101 is made possible.  We thank Michael Beloff, CFP®, ChSNC® Belvedere Wealth Partners, for donating his time and financial expertise and Caroline Fuchs, CAE, for contributing her time, communications, and digital strategy expertise to the FD/MAS community for this resource.