In our last blog, we talked about how you can be denied SSD benefits if you are engaging in SGA, as well as what the implications will be if you quit your job so that your SGA won’t affect your claim. Although SGA is complicated for traditional employees, it is even more complicated for claimants who own businesses.
How is SGA determined for business owners?
Just because your small business may make over $1,090, it doesn’t mean that you, as the business owner, make that much money each month, and it isn’t a strong indicator of whether you are engaging in SGA or not. You’ll be glad to know that the SSA recognizes this, and if you are a business owner and you aren’t applying for benefits based on blindness or vision problems, the SSA will take a much closer look at what you do for your company. The SSA has come up with what they call “The Three Tests” to help them determine if your activity within your business is SGA.
Your business activity is considered to be SGA if:
- The work you perform for your company is worth $1,090 per month or it prevents you from having to pay an employee to do the same value of work.
- The work you perform is comparable to the work that people without a disability perform in the same business or similar businesses.
- The work you provide is significant to the business and you receive a substantial income from the work you provide.
In addition to determining your contribution to your company, the SSA will also deduct any of your incurred business expenses from your company’s net earnings. The SSA will also subtract any impairment related work expenses and subsidies in order to accurately compare your company’s earnings to the SGA income threshold.
SGA is complicated, and it can be very confusing. If you have questions or concerns about SGA, or you wish to determine if you are currently engaging in SGA, contact our long term disability attorney in Louisville today.