Overview of Social Security Disability Programs and Work Incentives - slide 9
Student Earned Income Exclusion
Under age 22
Can exclude up to $1,640/month and $6,600/year for 2010
Must be “regularly
attending school”
Gross Earned Income $ 1,730.00
Student-Earned Income Exclusion – $ 1,640.00
Remainder $ 90.00
GIE if not used above – $ 20.00
Remainder $ 70.00
Earned Income Exclusion – $ 65.00
Remainder $ 5.00
Impair. Related Work Exp. – $ 0
Remainder $ 5.00
Divided by 2 $ /2
Remainder $ 2.50
Work Expenses if Blind – $ 0
Total Countable Earned Income $ 2.50
Total Countable Unearned Income $ 0
Total Countable Earned Income + $ 2.50
Countable Income $ 2.50
PASS Deduction – $ 0
Total Countable Income $ 2.50
Base SSI Rate $ 674.00
Total Countable Income – $ 2.50
SSI Payment $ 671.50
Now that you have the basics of the 2 programs, let’s take a look at the work incentives available for each one. I will start off with the work incentives for SSI or Supplemental Security Income. There are 4 work incentives that we will talk about: Student Earned Income Exclusion, IRWE (Impairment Related Work Expense), Blind Work Expense and PASS (Plan for Achieving Self Support).
Let’s start with Student Earned Income Exclusion or SEIE. Student Earned Income Exclusion is an SSI work incentive program that allows individuals under 22 who regularly attend school to exclude up to $1,640 of earned income per month (up to $6,600 per year) in 2010. This exclusion is applied before any other exclusion. You should apply the exclusion only to the earned income and consecutively to months in which there is earned income until either the exclusion is exhausted or the individuals are no longer under age 22. Regularly attending school means the individual takes one or more courses of study and attend classes in a college or university for eight hours a week or in grades 7-12 for 12 hours a week or in a training course to prepare for employment for 12 hours a week or for less time indicated above for reasons beyond the student’s control, such as illness.
Let’s look at an example of how SEIE affects an individual’s SSI cash benefit. Mary is 20, single and lives alone. She works full-time earning $1,730 a month and receives SSI. Mary is able to exclude $1,640 due to the Student earned income exclusion.
This leaves her with a remainder Total countable income (after you deduct the general income exclusion, earned income exclusion and divide by 2) of $2.50.
When you deduct this from the Full SSI rate of $674, Mary will get an SSI check of $671.50 plus her paycheck of $1730. Had Mary not utilized this work incentive she would not be eligible for any SSI cash benefit! This is an unbelievable work incentive for students!