What Will Happen If I Draw Disability Benefits, Work, and Don't Tell Social Security?

Social Security disability benefits are intended to help people who can't work because of physical, mental, or cognitive impairments. So you generally can't work if you're receiving Supplemental Security Income (SSI) without losing at least some of your benefits. And you can only work a small amount while receiving Social Security disability insurance (SSDI) benefits.

If you do work—even if it's only a part-time job—you must report it to Social Security. The risk of working without reporting it might seem worth it at first glance. But Social Security will eventually find out about any work you're doing—whether or not you tell the agency about your job. And when that happens, you could face serious consequences.

How Social Security Finds Out About Your Work

If you don't report that you're working, how does Social Security know about your job and how much you've earned?

Employers Report Your Earnings to Social Security

Social Security earnings records are provided for most jobs through information reported to the Internal Revenue Service each year. Social Security gets a copy of your annual W-2 report at the same time you do. If an employer reports earnings for your Social Security number, Social Security will know that you've been working.

You're Reported to Social Security by Someone You Know

What about working "under the table?" Even if you're working on a cash basis, those earnings count for disability eligibility purposes, so you must report them to Social Security. How does Social Security know if you're working for cash?

Generally, Social Security learns about individuals working for cash while collecting disability benefits when someone reports them to the agency. Sometimes individuals are reported by:

• friends
• family members
• ex or estranged spouses
• co-workers
• supervisors, or
• neighbors.

Social Security has to investigate each of these reports to determine if the person reported is indeed working.

Social Security Might Learn You're Working During a Disability Review

Social Security sometimes learns about work activity during a routine disability review or CDR (continuing disability review). For instance, during a CDR, Social Security might see a doctor's note that mentions that you've been doing some work or something that sounds like work activity.

Other times, someone else's allegation that an individual is working that triggers a "work review" or "work CDR." What's a work review?

During a Social Security work review, the agency contacts your employer(s) for a monthly breakdown of your earnings. After receiving all your employment information, Social Security will review how much you worked (and earned) each month. The agency will use the information to determine which months your benefits should've been reduced and when you weren't entitled to receive a benefit check (more on "overpayments" below).

How Much Work Is Too Much to Keep Getting Disability?

Social Security does allow you to work while receiving disability benefits, but how much you can work and keep getting benefits is limited. And the rules for working while getting Social Security differ depending on whether you're getting SSDI or SSI benefits.

If you're getting SSDI benefits, you can't engage in "substantial gainful activity" or SGA, which Social Security defines as earning more than a specific amount of money. The SGA limit for 2023 is $1,470 per month ($2,460 if you're blind).

If you're getting SSI benefits, you can work as long as your income is below the maximum monthly benefit amount ($914 in 2023). But Social Security doesn't count about half your work income. Your SSI benefits will be reduced by the amount of income that the SSI does count. You can actually make up to about $1,800 before your SSI benefit is reduced to nothing

What Happens If You Don't Report Work to Social Security?

Social Security is cracking down on individuals who knowingly don't report work activity and continue to collect disability benefits. There are penalties for those who try to cheat the system.

What will happen when Social Security finds unreported work activity? At the very least, you could find yourself owing Social Security money for the overpayment. Additionally, the SSA can apply $25-$100 reductions to your payments as a penalty or might withhold your payments altogether for up to six months (for a first violation) or a year (for a second violation).

At worst, you could be charged with Social Security fraud—and face penalties including:

• a fine of up to $250,000, and
• up to five years in prison.

(See Social Security Act §208 for information on SSDI fraud penalties and §1632 for information on SSI fraud penalties.)

What Are Overpayments and How Do You Pay Them Back?

If you failed to report that you were working and Social Security pays you too much, you will owe Social Security for the "overpayment" (the amount the agency overpaid you). Social Security will take all or part of your SSDI or SSI benefits until you've repaid all the money.

Reporting all your work activity will prevent overpayments and will allow you to receive information that could prevent your disability benefits from being suspended or terminated.

It's possible to work while you're receiving SSI or SSDI without getting into trouble. Learn more about how you can work without losing your disability benefits.

_{Updated June 30, 2023}