What Is SGA (Substantial Gainful Activity)?

In evaluating whether you are disabled, the Social Security Administration (SSA) will first look to whether you are currently working. If you are working part-time and not earning much money, you won't necessarily be denied disability benefits, but working full time guarantees that you'll be denied benefits. Here's why.

How SSA Defines Disability

As part of its definition of disability, the SSA requires that a disability claimant (applicant) be unable to perform what it calls substantial gainful activity (SGA).

What Is Substantial Gainful Activity?

SGA is work that brings in over a certain dollar amount per month. In 2012, that amount is $1,010 for non-blind disabled applicants, and $1,690 for blind applicants. If you are making more than that amount per month, the SSA figures that you must not be disabled (in their words, that you "are able to engage in competitive employment in the national economy"). SGA does not include any income you obtain from non-work sources, such as interest, investments, or gifts.

Will Your Claim Be Denied Due to SGA? 

Individuals who work and earn gross monthly income exceeding the SGA threshold are not considered disabled and are ineligible to receive benefits. (Read why the SSA uses an earnings cutoff amount.) How much you are earning is one of the first things the SSA or DDS looks at, so if you are making over $1,010 per month when you apply, your claim will be denied almost immediately, without medical a review (your medical records will not be requested or evaluated because you will be considered ineligible for benefits based on non-medical criteria).

What If You Stop Working?

If you stop working after you apply for benefits (because you find out SGA will disqualify you), you must be able to prove to the SSA that your medical condition worsened to the point where you had to stop working (that is, performing the SGA).

Rules for Small Business Owners

If you are self-employed (you own your own business), the SSA recognizes that whether a small business's net profit is over $1,010 per month isn’t necessarily a good indicator of whether you’re doing substantial gainful activity. Instead, the SSA will try to look more closely at what you're doing for the company. The SSA will apply what it calls “The Three Tests” to determine if your business activity is SGA.

Your business activity will be considered SGA if you perform work that:

• provides significant services to the business, which brings in $1,010 or more in average monthly income 
• is comparable to the work of persons without disability in your community engaged in the same or similar businesses, or
• is worth $1,010 per month in terms of its effect on the business or what it saves you from having to pay an employee to do the work.

In addition, in judging your contribution to the company, the SSA will deduct any “unincurred business expenses” from your net earnings , which are expenses that you don’t pay for—that is, contributions made by others. For example, if a friend volunteers for your business to help you out or if you receive equipment through a vocational training program, the value of these expenses is deducted from your net earnings before comparing it to the SGA amount, in order to give the SSA a more accurate value of your work.

Rules for Recipients of Disability Benefits

If you have been approved for and are receiving disability benefits, you can continue to make up to $1,010 per month without losing your benefits. If your medical condition improves and you want to try going back to work to make more than that amount, the SSA will allow you to make more than the SGA amount for a certain number of months (called a trial work period) to see if it works out.