Social Security payments are a vital source of income for many Americans. However, some beneficiaries of Social Security Disability Insurance (SSDI) may face payment cuts due to certain factors. One reason SSDI payments could be reduced is if the beneficiary returns to work and exceeds the income limits set by the Social Security Administration (SSA).
The SSA allows beneficiaries to work without losing their benefits for a nine-month trial period. If, after this period, the beneficiary’s income exceeds $1,550 per month, their payments will be suspended because they are considered to be in substantially gainful employment. Another reason for losing SSDI payments is incarceration.
If a beneficiary is sentenced to more than 30 days in prison, their Social Security payments will be suspended. Once released, the individual must reapply to resume payments. To avoid losing SSDI payments, beneficiaries should inform the SSA of any employment status or income changes and refrain from exceeding the established income limit during the trial work period.
They should also keep their personal details up to date with the SSA so that they stay informed about their benefits and any potential changes. Most retirees rely on Social Security to some degree, with 88% of retired U.S. adults saying their benefits are either a major or minor source of income, according to a 2024 Gallup poll.
SSDI payments and income limits
However, many Americans are unaware that continuing to work could reduce their benefit amount. If beneficiaries are under full retirement age (FRA) and earning income from a job, their benefits may be withheld if their earnings surpass certain limits. In 2025, the income limits are $62,160 per year for those reaching FRA and $23,400 per year for those not reaching FRA.
Benefits are reduced by $1 for every $3 or $2 earned above these limits. The good news is that these reductions are temporary, and the withheld amount will be paid out incrementally once the beneficiary reaches FRA. However, their lifespan depends on whether they will recoup all the withheld money.
Many Americans are also surprised to find their Social Security benefits cut due to the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO). These provisions affect individuals who have worked in both the private and public sectors, preventing those who receive government pensions from also collecting full Social Security benefits. The WEP and GPO disproportionately impact middle-class workers in certain states, such as teachers, firefighters, and police officers.
Even a brief stint in a government position can trigger cuts to Social Security, resulting in financial surprises for retirees. The debate surrounding these provisions remains contentious, with critics arguing that they unfairly penalize workers. At the same time, supporters claim they are necessary for maintaining fairness and the financial stability of the Social Security system.
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