The Short Answer
Yes, you may be entitled to Social Security Disability Insurance (SSDI) if you’re self-employed and have paid into Social Security. To be eligible, you must have earned sufficient work credits by paying self-employment tax, and you must have a qualifying health impairment that’s expected to last for at least 12 months. There’s also a strict limit on your monthly self-employment income after deductible expenses.
Key Takeaways
- Self-employed individuals must meet the same medical criteria as other applicants to be considered disabled.
- In addition to your income, the SSA looks at the value and quantity of work that you provide when considering if you’re gainfully employed.
- In some cases, the services you provide may meet the threshold for a significant gainful activity even if you earn less than the income limit.
- Once you start receiving benefits, there’s a cap on how much monthly income you can earn before your benefits will end.
- Due to the complexity of Social Security regulations for self-employed individuals, it’s worth consulting a disability attorney for help with your application or appeal.
3 Tests for Determining SSDI Eligibility if Self-Employed
If you’re self-employed, you must have a qualifying health condition that prevents you from engaging in a substantial gainful activity (SGA) to be considered disabled. For 2025, you are considered gainfully employed if you earn $1,620 per month or more. This limit changes annually. Since compensation for independent contractors and self-employed individuals varies, the Social Security Administration has developed several alternative tests for valuing your work contributions.
1. Significant Services and Income Test
This is the most common eligibility test that the Social Security Administration uses to assess the value of self-employment labor. If you’re a sole proprietor, your services are significant for running the business. If you work in a partnership, your services are significant if you’re responsible for at least half the responsibilities or if you spend more than 45 hours per month managing the business. The SSA also looks at your countable income, which is your gross revenue minus deductible expenses.
2. Comparability Test
Test 2 assesses the quality and quantity of the work you perform as compared to an unimpaired employee or business owner. The agency will consider your job responsibilities, the time spent running your business, and the level of skill or effort required to do your job. If the SSA finds that you work as hard as someone without a disability, it may determine that you have the capacity for gainful employment.
3. Worth of Work Test
If your self-employment income is low or inconsistent, the SSA may use the worth of work test to value the labor that you provide. Even if you don’t work as much or as efficiently as a non-disabled person, the SSA may determine that you are not disabled if the cost of hiring a replacement would meet or exceed the SGA threshold.
Tests for Continued Benefits Eligibility
The SSA also has rules to determine if you’re entitled to continue receiving benefits once your application is approved. Income limits vary as follows:
Trial Work Period (TWP)
If you’re approved for SSDI benefits, you can test your ability to return to work during the trial work period. You have 9 months during any 60-month period where you can receive unlimited income. Any month where you earn more than $1,160 (for 2025) or work more than 80 hours counts toward the 9-month limit.
Extended Period of Eligibility (EPE)
After you’ve exhausted your 9-month TWP, you enter a 3-year Extended Period of Eligibility. During this time, you must keep your monthly self-employment income below the SGA limit to continue receiving disability benefits. If you return to work but are later disabled due to the same impairment, you are eligible for expedited reinstatement for up to 5 years from the time that your original benefits ended.
SSDI and Self-Employment FAQs
Which Business Expenses Does the SSA Deduct When Calculating SGA?
The SSA may look at your tax records when considering your financial eligibility. Business expenses that you deduct on Schedule C and Schedule SE, such as office supplies, equipment, vehicles, and mileage, are excluded from your income when calculating SGA. Once you start receiving benefits, impairment-related work expenses can also be deducted.
Do Self-Employed Workers Receive Medicare on SSDI?
Anyone who is approved for Social Security disability can qualify for Medicare after 24 months of receiving benefits, including workers who are self-employed.
How Many Work Credits Do I Need for Disability if Self-Employed?
Most adults who apply for SSDI need somewhere between 20-40 work credits, depending on their age. Generally, half of these credits must be earned in the 10 years before the onset of the disability. You can earn up to 4 work credits per year by paying your Self-Employment Contributions Act (SECA) tax. For 2025, you must earn at least $1,810 per quarter for each credit. You can check your credits by contacting the SSA or logging into your online account.
Contact a North Carolina Social Security Disability Lawyer
Rules regarding SSDI and self-employment income are particularly complex. To avoid having your disability benefits unfairly denied or canceled, consult an experienced disability lawyer who can assess your case, check your tax records, and help you prepare your application or appeal. Contact our office in Greensboro or Winston-Salem for a free case review.
