Hello Friends,

Many of you may not know this, but I have a pretty strong fear of heights.  However, a friend managed to convince me to try a little mountain climbing recently.  All I can say is I tried never to look down and managed to make it to the top.  As they say, the view was worth it but I’m not sure I will be repeating this any time soon!  Here’s a topic I get asked about on occasion.

People who are self-employed are increasingly dependent on the use of technology for both business tasks themselves and record maintenance. A self-employed Social Security Disability Income (SSDI) beneficiary or a Supplemental Security Income (SSI) recipient is often able to apply certain technological costs used in connection with their work activity as deductible expenses (as allowed by IRS) to arrive at their Net Earnings from Self Employment (NESE.) This is the amount that the Social Security Administration (SSA) uses in determining Trial Work Period (TWP) service months, Substantial Gainful Activity (SGA), and countable earned income for SSI.

Computer hardware, software, and supplies and phone equipment are the kind of costs that may be declared as a capital expense or a business deduction if used in a self-employed person’s business. A capital expense is normally the cost of getting started in business before actually beginning operations. A person can then recover the amount spent through depreciation, amortization, or depletion which allows a deduction of part of the cost each year. A person may elect to deduct or amortize certain business start-up costs.

To be deductible as a business expense, an expense must be both ordinary (common and accepted in the business) and necessary (helpful and appropriate for the business.) An expense does not have to be indispensable to be considered necessary. Normally, if an expense is used partly for business and partly for personal purposes, the business part may be deductible.

For specific tax issues a beneficiary should consult with a tax advisor and/or the Internal Revenue Service (IRS.)

Also remember that for SSA programs, an expense may possibly be used as an Income Related Work Expense (IRWE) or for a Plan to Achieve Self Support (PASS) but cannot be used more than once.

Under the Social Security Administration (SSA) Title II program, the spouse and children of a person who is receiving Retirement Insurance Benefits (RIB) or Disability Insurance Benefits (DIB) or who is deceased may receive family benefits. However, there is limit on how much a family can receive on one Social Security earnings record, regardless of the number of beneficiaries entitled on that record. Whenever the total amount of the original monthly benefits of all the beneficiaries entitled on one record exceeds this limit, SSA adjusts the benefits.

This limit, called the Family Maximum (FMax), can reduce each family member’s benefit below what would normally be paid.

To calculate the FMax amount, SSA uses one of various methods that are related to the type and computation of the original benefit (Primary Insurance Amount or PIA) of the person on whose record benefits are being paid (wage earner.) These formulas can become somewhat complicated since they involve using numerous factors. For example, for DIB the FMax (called the DMax) is usually 85% of the average of the wage earner’s lifetime monthly earnings, but it cannot be less than the wage earner’s PIA or more than 150% of the PIA. For a RIB beneficiary or deceased wage earner, the FMax computation is different with the FMax amount being at least 150% of the PIA. POMS RS 00615.730

It is possible for the FMax for a DIB beneficiary to be the same as or less than his/her PIA, in which case no auxiliary benefits are paid. This happens when the PIA amount is 85% or less of the wage earner’s average lifetime monthly earnings which occurs when a wage earner’s average lifetime earnings are relatively low.

To apply the FMax to a family’s benefits in life cases, the RIB or DIB beneficiary’s PIA is first subtracted from the FMax amount, and then the remainder is divided proportionally among all the other beneficiaries on the record. So in situations when a DIB beneficiary’s DMax is the same as his/her PIA (as mentioned earlier), family members would not be eligible for any payments on that record. POMS RS 00615.756

When the wage earner is deceased and the total amount of original benefits for all the survivor beneficiaries exceeds the limit, the distributions of the FMax among the entitled survivors may not be equal. When all the original benefits are 75% of the PIA, the FMax is distributed in equal amounts; when the original benefits are not based on the same percentage of the PIA, the FMax is proportionately divided based on each beneficiary’s original benefit rate (for example, a widow(er) receiving 82.5% and other survivors 75% of the PIA.)

The FMax can be exceeded in certain exceptional situations, such as with the entitlement of a divorced spouse in certain cases. POMS RS 00615.801

Also, when a child is entitled to Social Security benefits on more than one parent’s record, SSA will combine the family maximums from the parents’ records if a higher benefit for the child results (there is an upper limit on a combined maximum.) The amount of the monthly payment for just the child is based on the combined family maximum. POMS RS 00615.772 (C.1)

Recalculating SSDI
You may notice that some SSDI beneficiaries see their benefit increase during the turn of the year. Let’s take a closer look at two events that cause this – The Cost of Living Adjustment (COLA) and recent quarters of coverage due to work earnings.

COLA Increase
Social Security adjusts the SSDI payment using the COLA percentage. In 2012, this amount is 3.6%. Each individual has a different dollar amount increase, as it is based on their previous benefit amount. The increased benefit amount can change eligibility for other benefits the person is accessing.

Let’s take a closer look at individuals who have concurrent benefits – SSI and SSDI. The COLA can cause someone to lose SSI eligibility, therefore lose automatic Medicaid. These individuals can apply for Medicaid at their local County and Tribal Human Services Offices or www.access.wisconsin.gov. They may be eligible for Medicaid through other programs such as Special Status 503 or MAPP. Special Status 503 is a way to get Medicaid that disregards COLA to the date it occurred. MAPP is a Medicaid program for individuals with disabilities who are working. They both have different eligibility criteria you can review using the Medicaid Eligibility Handbook.

Work Earnings and New Credits
SSDI beneficiaries who are working are contributing to their maximum benefit amount because they are earning Social Security Credits as they contribute to payroll taxes. Each year, Social Security will recalculate benefits for SSDI individuals, and sometimes the result is a higher benefit amount. This could have quite an impact on someone who has other benefits.

Individuals who have concurrent benefits could lose SSI eligibility and 1619(b) coverage with an increased SSDI payment. This means a loss of Medicaid. There is not a Special Status Medicaid group that allows someone automatic Medicaid coverage by applying for a State Medicaid program. These individuals must apply for Medicaid at their local County or Tribal Human Services agency.

Dear Ben,

I’ve been getting DIB SSDI for over 7 years because of a physical injury. I decided a few months ago to try to go back to work. The work has been going alright – I’ve been making around $1500 gross a month for 6 months and plan to continue. I’ve kept the SSA office informed. They said I can work at least 9 months with my benefits continuing, then if I am working as much as I have been, my benefits might stop after three more months of payments. They called work that would end my benefits as substantial gainful activity, or SGA for short.

I’m not sure I completely understand SGA? Could you explain it more?

Shirley
Manawa WI

Dear Shirley,

Substantial Gainful Activity (SGA) can be puzzling, but since it is a key factor in the Social Security Administration (SSA) disability programs, understanding it is important.

SGA is a critical concept or idea because SSA’s definition of disability is tied directly to a person’s capacity to work. To become eligible for disability benefits (either Social Security Disability Income, SSDI, or Supplemental Security Income, SSI), a person’s disabling condition must prevent the person from engaging in SGA, which is the performance of significant physical and/or mental activities in work for pay or profit. So regardless of how severe a person’s disability may be, if that person is performing SGA, then he or she is normally not considered disabled for Social Security programs.

SSA considers SGA when someone first applies for SSDI or SSI disability and also later when an SSDI beneficiary has completed their nine month Trial Work Period, which will be your situation soon if you keep working at your present level. (SGA is not considered for SSI once a person becomes eligible.)

In measuring whether or not a beneficiary’s work is SGA, SSA starts by looking at how much the person is earning from that work. This is the gross wages for someone who is an employee and the Net Earnings from Self Employment (NESE) for a self-employed beneficiary. For you as an employee, SSA will look at your gross wages.

Next SSA compares the gross wages to the SGA earnings standard which is the gross monthly amount of work income that for SSA indicates substantial work. In 2010 the SGA earnings amount is $1000, which your wages are exceeding at this point. This SGA amount is adjusted each year based on the national average wage; different rules and amounts apply to people who are blind.

If a beneficiary’s monthly gross earnings exceed the SGA amount, SSA reviews the nature and extent of the work activity itself and looks for any indication that not all of the beneficiary’s wages should be counted because the person is not truly earning them. So SSA considers any special conditions or subsidies the beneficiary may receive at work. SSA also may deduct from a beneficiary’s wages any Impairment Related Work Expenses (IRWE), which are expenses the beneficiary pays for items or services related to his/her disability and needed to work. And any sick or vacation pay the person receives for non-work days in a particular month are also not counted as income for SGA purposes for that month. These deductions could potentially apply to you.

In some cases SSA may look beyond a beneficiary’s wages if there is evidence that despite low pay the person may be engaging in SGA. SSA may decide that a beneficiary is engaged in SGA if the value of the work is more than what is paid. However, after 2006 for an SSDI beneficiary who has received benefits for 24 months, SSA will apply only the SGA earnings guidelines to the beneficiary’s countable income and not consider any evidence showing that the work activities may be worth more. So SSA would only be looking at your wage earnings.

The first month after the end of your TWP in which your countable income from work is over the SGA level will be your cessation month. SSA will pay benefits for the cessation month plus two more months (the grace period), and then benefits stop. (POMS DI 10505.020D, POMS DI 10505.001)

I hope this helps you understand how SGA applies to your situation so you can decide what you want to do.

Ben

on the Ben Lomond trail in Utah

Hi Friends,

Just returned from a trip to Utah where I did some hiking on the Ben Lomond Trail.  Picturesque as you can see. Here’s I question I recently received from a veteran in Wisconsin. 

Dear Ben,

I’m disabled and receive VA and Social Security benefits. I get my medical treatment from the VA. I will soon be eligible for Medicare. Should I enroll in Medicare since I already have VA? Can I even have both VA health care and Medicare?

Jack
Erin WI

Jack,

Yes, you may have both VA (Veterans Affairs) health care and Medicare. Whether or not you choose to enroll in Medicare is a personal choice and depends on your circumstances and what options you may want in the future. Most veterans have a number of decisions to make in this regard and should be aware of what the choices and their implications are.

The VA encourages veterans to get any health care coverage they can, especially those in the lower enrollment priority groups since VA’s ability to provide health care benefits is restricted each year to the amount appropriated by Congress. That amount can change and restrict the number of veterans enrolled for VA health care benefits, so having a secondary source of coverage may be in a veteran’s best interest. Even if VA coverage continues unchanged, a veteran may be able to use a secondary source of coverage as a supplement to their VA care.

A Medicare enrollee can decide which parts he/she wishes to participate in. Part A (Hospital Insurance for inpatient care) is free so is normally worth enrolling in. Part B (Supplemental Medical Insurance for physicians and outpatient care) has in 2011 a monthly premium of $115.40; the premium usually rises each year. An alternative to traditional Parts A and B is Part C (Advantage Plan) which is care through a managed system (e.g. an HMO), administered by private companies as approved by Medicare. Part C plans also often include prescription drug coverage (see Part D below.)

All parts usually have certain co-payments and deductibles that an enrollee is responsible for paying. If a person does not enroll in Parts B or C when initially eligible, there is normally a 10% surcharge in the premium for each year that goes by.

By having both Medicare Parts A and B (or C) and VA care, a veteran has the choice to seek treatment from non-VA physicians. Depending on a veteran’s eligibility for care, VA may determine that he/she is not eligible for some care or be required to make a co-payment. These same services may be fully covered by Medicare Parts A and B or C.

Another part of Medicare is Part D which is for prescription drugs. The monthly cost of a Part B plan varies depending on factors such as the drug formulary and co-payments; low income subsidies to help pay for Medicare Part D are available from the Social Security Administration or Wisconsin Medicaid. If a person does not enroll in Part D when initially eligible, there is normally a 10% surcharge on the premium for each year that passes. However, this surcharge does not apply for a veteran enrolled in the VA health care system since it is considered creditable coverage for Medicare Part D purposes. So if VA takes some action that causes a veteran to lose VA drug coverage, the affected veteran can enroll in Part D without penalty if done within 62 days of the end of VA coverage.

Veterans are still eligible to receive VA health and prescription drug benefits if they choose to enroll in a Medicare Part D prescription drug plan. Veterans do not have to choose between VA coverage and a Medicare prescription drug plan; they may participate in either or both. However, if a veteran decides to enroll in a Medicare prescription drug plan and to withdraw from the VA, he/she may not be able to re-enroll later if the VA is not enrolling all priority groups.

Having both VA drug coverage and Part D allows for flexibility, too. For example, you may obtain prescription drugs that are not on the VA formulary if prescribed by non-VA physicians. VA prices tend to be lower for both generic and brand-name drugs, but the VA has a restricted formulary and limits where a veteran can get prescriptions (a VA doctor at a VA facility.) Under most Medicare Part D plans, a person can get prescriptions at any pharmacy.

TRICARE, which is the Department of Defense (not VA) health care program for active duty service members, National Guard and Reserve members, retirees, families and survivors, is different. TRICARE beneficiaries must enroll for Medicare if eligible and pay the monthly Part B premium in order to remain eligible for TRICARE. Active duty family members are not required to purchase Part B until their active duty sponsor retires. Primary coverage comes from Medicare, and TRICARE acts as the secondary insurance covering the co-insurance and deductible amounts not paid by Medicare.

So as a veteran you need to consider the all possibilities and decide what is best for you. You may want to seek further information from your local county VA service office, a benefits specialist, or the VA website: http://www.va.gov/health/default.asp
Ben

Back in Madison visiting UW!

Dear Pat,
This is a timely topic and one that is asked about frequently.  Timely because I am back in Madison and happen to be visiting the beautiful University of Wisconsin Campus!  What you heard is partially true; how such debt is settled depends on several factors.

The federal government can reduce payments from various federal programs (including Social Security Disability Benefits or SSDI) to pay off old student loan obligations; and there is no statute of limitations for student loan debt collection purposes. The Benefit Payment Offset (BPO) automated system collects delinquent non-tax debts owed to the federal government from payments by other federal agencies. This applies to SSDI benefits but not to Supplemental Security Income (SSI) payments. (POMS GN 02410.300)

However, you should still pursue your claim for SSDI with Social Security since you have some options in dealing with the debt and still be paid benefits if allowed. The reduction of an SSA benefit under BPO can be appealed, but not to SSA since it is not the creditor agency. In your case a request for any kind of relief from repaying or other questions about the debt has to be directed to the Department of Education (ED), the creditor agency. SSA is not authorized to stop or delay the collection of another agency’s debt.

One reason you should still apply for SSDI is that if SSA decides you became disabled several months in the past, you may have back benefits due from which no money will be withheld via BPO. Such accrued payments that include retroactive amounts due are not subject to BPO.

In addition, BPO cannot reduce a person’s SSDI payments below $750 per month, so you would receive $750 per month in SSDI if your benefit amount is that high.

You also may be able to work out an agreement with ED to repay the loan at a rate that is reasonable to the agency and affordable to you. ED will send you a notice about the offset and give you the opportunity to review your loan records and make arrangements to repay the loan in this way.

Total loan relief from DOE is possible under certain circumstances. For example, if the DOE decides that you have become totally and permanently disabled, you may not have to make any further payments. However, you cannot be considered totally and permanently disabled on the basis of a condition that existed at the time you applied for the loan unless the condition substantially deteriorated later. The conditions a borrower needs to meet to qualify for debt relief are listed in DOE regulations 34 C.F.R. 682.402(c): http://www.ed.gov/offices/OSFAP/DCS/loan.cancellation.discharge.html

You may request a “Physician’s Certification of Borrower’s Total and Permanent Disability” (Form 1172) from the DOE: http://www.ed.gov/offices/OSFAP/DCS/forms.html

Ben

Greetings from Sian Ka’an Tulum, Mexico

Dear Ben,

The last time I spoke with someone at SSA I was told that I will become eligible for SSDI in a few months. I was told that this is true if I keep working. How will SSA decide how much SSDI I get? Will my SSI payments stop? Could you tell me what process I will have to go through when this happens? Do I have to have a new disability determination? The person at Social Security told me that I cannot decline to take SSDI, is that true? If I am going to lose my Medicaid in this process, I might consider quitting my job, so I don’t become eligible for SSDI.
Frieda
Markesan WI

Frieda,
The Social Security Administration (SSA) representative was talking about Disability Insurance Benefits (DIB) which a person qualifies for based on his or her own earnings and being disabled. The two other types of Social Security Disability Income (SSDI) are Widow(er) Insurance Benefits (WIB) and Childhood Disability Benefits (CDB, also called DAC.) WIB are based on the earnings of a person’s deceased spouse, and CDB on the earnings of a retired, disabled, or deceased parent.

A Supplemental Security Income (SSI) recipient is required to apply for and take SSDI benefits (or any other kind of benefit or payment) if entitled. This is because SSI is intended to be a program of last resort in providing income.

To be entitled to DIB a person must have earned Social Security work credits by paying FICA tax on his or her gross wages and/or net earnings from self-employment. A person earns a work credit (also called a Quarter of Coverage or QC) by earning a specific amount at any time during a calendar year. In 2011 that amount is $1,120. A person can earn up to 4 work credits per year.

A person must accumulate a specific number of work credits within a certain time period to qualify for DIB. Someone under age 24 needs 6 credits earned during a three year period. For those over age 24 the number and distribution of required credits depend on their age. So in your case, you need to have earned 6 credits within a three year period. Given the level and continuity of your work earnings, it appears you may already have the required number to qualify for DIB.
The amount of your DIB payment will depend on the amount of your earnings. To calculate a DIB monthly payment, SSA takes a person’s past work earnings, adjusts them for inflation, averages them, and takes a percentage of that figure.

Your SSI payments (including the Wisconsin state supplement) will stop if your DIB amount is $694 or more per month in 2011. Your automatic eligibility for Medicaid through SSI would also end; although, you may still qualify for Medicaid through some other program by applying at your county’s human services department.
If your DIB amount is less than $694, you will continue to be eligible for SSI, but perhaps in a non-pay status because you are working. You would not lose Medicaid coverage in this situation.

SSA provides SSI recipients with a work incentive called 1619(b) that allows Medicaid to continue if work earnings are what prevent an SSI payment. For 1619(b) a recipient must also need Medicaid to work, have total earnings below a certain threshold ($31,468 in 2011 in Wisconsin in most cases), and otherwise still meet the SSI eligibility standards.

The SSA computer system screens SSI recipients for potential DIB entitlement once per year, but these controls have certain systems limitations and do not always identify recipients with enough credits for DIB. SSA also normally checks a working SSI recipient’s earnings record at his or her yearly income and resource redetermination for possible DIB entitlement. However, if an SSI recipient believes they have accumulated the required work credits, he or she should contact SSA and speak to a Claims Representative. If you appear to have enough work credits for DIB, you will have an interview with an SSA representative who will handle your application for DIB. You will not need a new medical decision because the same disability standards that apply to SSI apply to SSDI. You will still have any Medical Continuing Disability Reviews as scheduled.

I hope this helps! When you contact SSA, a representative can answer any other questions that arise.
Ben

The Social Security Administration (SSA) recently announced the beginning of the Benefit Offset National Demonstration (BOND) project. BOND is a special project that will test a new way to treat earnings for Social Security Disability Insurance (SSDI) beneficiaries. SSA’s goal is to find out how disabled beneficiaries respond to rule changes that allow them to keep more of their benefits while trying to return to work.

Under current program rules, individuals who receive SSDI benefits generally lose their entire monthly cash benefit if their earnings exceed the $1000 per month after using up a nine-month trial work period (TWP). SSA pays benefits through the TWP and for an additional three months. If the worker continues to earn over the $1000 monthly limit in gross wages, SSA suspends benefit checks.

The BOND program provides randomly chosen SSDI beneficiaries with a gradual reduction of benefits ($1 for each additional $2 earned over a yearly threshold of $12000)—thus eliminating the “cash cliff” currently in effect. Those eligible for the benefit offset will be able to earn more from work and keep some of their disability benefits. SSA will continue to provide Medicare coverage to BOND participants earning over the limit.

Many SSDI beneficiaries worry about losing their cash benefits if they earn too much money. Congress has asked SSA to test policy changes to encourage workers with disabilities to return to gainful employment. SSA will randomly select SSDI beneficiaries in 10 sites around the country for the BOND project. The test will run from 2011 until September of 2022. Individual participants can only participate in the BOND test for five years.

State BOND offices will work with local agencies to explain BOND. If you are a SSDI beneficiary who receives a BOND notice in a letter or a phone call, be sure to contact BOND. If someone in your family receives a notice or call, encourage that person to respond. You can call toll-free:

More Information:
Visit the BOND Website: http://www.bondssa.org
Voice: 1-877-7BOND09 (1-877-726-6309)
TTY: 1-877-7BOND90 (1-877-726-6390)

Summer in Siberia

I’ve received SSDI for several years and returned to work 6 months ago. I have used 5 months of my Trial Work Period. I have been earning a steady monthly gross of $900 per month and plan to continue to work at the same pace. It’s my understanding that I can work for at least nine months but then may lose my benefits. Is that true?

Georgia
Sun Prairie, WI

Dear Georgia,

SSDI beneficiaries such as you do get nine (9) months of a Trial Work Period (TWP) during which you can earn any amount and still receive your SSDI benefits. A month counts as a TWP month in 2010 if you earn more than $720 gross in a month.

Once you have used all nine of your TWP months, then what matters is if you continue to work and SSA considers that work to be Substantial Gainful Activity (SGA) which can lead to SSDI benefits stopping. In determining if work is SGA, SSA normally compares an SSDI beneficiary’s gross wages to that year’s SGA earnings standard which is a measure of substantial work for SSA; in 2010 the SGA earnings amount is $1000.

Even if your monthly gross earnings exceed the SGA amount, not all of those wages may be counted toward SGA if you are not actually earning them because of special conditions or subsidies. In addition, your countable wages for SGA may be reduced by any Impairment Related Work Expenses (IRWE), which are costs you pay for items or services related to your disability and that you need to work. And any sick or vacation pay you receive for non-work days in a particular month are also not counted as income for SGA purposes for that month.

The first month after your TWP after that your countable gross earnings are considered SGA is called the cessation month; you will still receive a benefit for that month and the following two months which are called the grace period. The cessation month and the grace period can come any time after the end of the TWP. So an SSDI beneficiary who starts and continues to do substantial work can still receive benefits for at least 12 months.

The month after your last TWP month, your Extended Period of Eligibility (EPE) begins; it is the next 36 consecutive months and begins whether you are working that month or not. You will receive benefits for any month in the EPE that your earnings do not exceed the SGA level, even if you have used your cessation month and grace period. Also note that the cessation and grace period can come during the EPE or even after the EPE is done.

So in your situation if you keep earning at your current level, your benefits will continue and you will not use your cessation and grace period months because you are below the SGA level. Your EPE will begin once your TWP is finished. If then at some point you do engage in SGA, the first month you do so will be your cessation month and the next two your grace period, during which you will receive benefits. If after that your earnings are no longer above SGA and you are still within your 36 month EPE, your benefits will resume. However, if your cessation and grace periods months occur after the end of your EPE, your benefits stop and you will have to re-apply for SSDI or possibly request an Expedited Reinstatement (EXR.)

I hope this gives you the information you need to decide what you want to do.

Ben

High up in Copper Canyon.

Dear Ben,

I get SSDI Childhood Disability Benefits on my disabled father’s record. What would be the effect on my benefits if I began trading stock and options, not as long term investments but closer to what would be considered day trading? I don’t want to violate any rules by trading stock and doing research in making a profit from my investments/trades. Would this be considered a form of entertainment like gambling at the casino is or more like self-employment?

Sid
Blackwell WI

Dear Sid,

You are not violating any Social Security Administration (SSA) rules by trading stocks and day trading; Social Security Disability Income (SSDI) beneficiaries can pursue whatever interests or enterprises they wish. However, if your activity is a business, SSA will look at it as self-employment and consider it to be work. The SSDI definition of disability is directly linked to a person’s capacity to do substantial work regardless of the nature of the person’s disabling condition; so if your activity is self-employment and substantial and sustained for a certain period of time, the possibility arises that you may be considered no longer disabled for SSA purposes and your benefits would stop.

SSA follows the Internal Revenue Service (IRS) regarding the definition of a business. Normally if a person intends to make a profit or produce income on a continuing basis from an activity, it is a business. (POMS RS 01802.001 ff)

Special IRS rules apply to traders in the business of buying and selling securities for their own account. If a trader regularly seeks to profit from daily market movements in the prices of securities and not just from dividends, interest, or capital appreciation, and if the activity is significant, it is a business and subject to self employment and FICA tax. (http://www.irs.gov/taxtopics/tc429.html)

Other factors that IRS considers in determining if trading is a business are: typical holding periods for securities bought and sold, the frequency and dollar amount of trades during the year, the extent to which the activity produces income for a livelihood, and the amount of time devoted to the activity. Consulting with a tax advisor or expert may be appropriate to clarify these issues and your options.

If your trading activities do not qualify as a business, you are considered an investor and not a trader, and you would not be self employed for IRS or SSA purposes (though any income realized would still be subject to regular income tax.)

If your trading activity is self-employment, then SSA considers your net profit (Net Earnings from Self Employment or NESE) and possibly other factors (such as the number of hours you work in a month) in determining your nine-month Trial Work Period and then in applying the $1000 per month Substantial Gainful Activity (SGA) standard. For SGA purposes, SSA looks at your month by month net income although averaging over a period of months is often possible. (Please see my posting of February 17th, 2010 which discusses self-employment in more detail.)

As you can see, self-employment in general and trading specifically can be complicated and is reviewed on a case by case basis by SSA. There may be other related factors involved in your situation that you are unaware, so ultimately discussing the issue with SSA will be needed to get an authorized answer.

I hope this works out so you can pursue your interests in the way you want.

Ben