The Social Security Administration (SSA) used “substantial gainful activity” on two separate occasions related to Sebastian N.’s disability benefits. First, Sebastian was deemed disabled because he was unable to continue working as a self-employed worker due to a medical condition. Later, Sebastian attempted to return to work, and his substantial gainful activity came into play again. Unless you have gone through the process of applying for Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) benefits, you may never have heard of substantial gainful activity. However, substantial gainful activity and the self-employed worker can be a complicated situation.
What is substantial gainful activity?
The SSA relates it to the dollar amount an individual can earn during a month. The 2019 monthly SGA earning amounts are:
- $2,040 for statutorily blind individuals;
- $1,220 for non-blind individuals.
Note that SGA does not apply to SSI benefits for blind individuals. However, SGA for non-blind disabled people applies to both Social Security and SSI benefits.
Is substantial gainful activity treated differently for a self-employed worker?
Yes.
For people who are employed, the SSA looks at the work they have done for which they were paid. However, a self-employed worker essentially runs his or her own company. Some of the work may not be paid, but still enhances or increases the value of the business.
The SSA uses three general tests to see if a self-employed worker has performed substantial gainful activity:
- Test One: Significant Services and Substantial Income. Activities are considered to be substantial gainful activity if that work is important to business operations, and if the worker receives a substantial income for that work.
- Test Two: Comparability of Work Activity. The work activity is substantial gainful activity if it compares to a non-disabled person doing the same type of work for wages.
- Test Three: Worth of Work Activity. If the work is worth more than the SGA Earnings Guidelines because of its effect on the business, it’s substantial gainful activity. Likewise, the SSA considers the value of the work if an employer had paid an employee to do it and counts it as substantial gainful activity if its value exceeds the SGA guidelines.
The SSA also may use another method called the Countable Income Test if:
- The self-employed worker performed the work after being on Title II disability for at least 24 months; and
- The work may indicate that the recipient is no longer disabled.
Substantial Gainful Activity Is Important for the Self-Employed Worker
Talk to an attorney about your eligibility for disability benefits if you are a self-employed worker. The attorneys at The Law Offices of Martin Taller have more than 50 years’ legal experience, much of it involving Social Security Disability Insurance claims. They can help you with your application and any appeals that might be needed.
Call us at 714-385-8100 for a free consultation. Though our office is located in Anaheim, we assist clients throughout Southern California.
