What is substantial gainful activity? (And why is it important to my disability case?)
Updated: May 23, 2021
Step one of the five-step sequential analysis asks whether a person is working and earning “substantial gainful activity.” In basic terms, substantial gainful activity, also called SGA, is a threshold, above which a person cannot receive disability benefits. No matter how severe a person’s impairments are, if they are performing SGA, they cannot receive disability benefits. There are exceptions to the rule, which will be discussed in later posts.
To break down the definition, “activity” means work. “Gainful activity” means that the work produces enough income to (hypothetically) support a person each month. On a yearly basis, the Social Security Administration (SSA) updates how much qualifies as substantial activity each month before taxes are taken out. Those limits are slightly higher for people who are blind, as defined by law, than those who are not blind. Here are the substantial activity limits per year.
“Substantial activity” means that there must be a connection between the work being done and the amount being paid. In other words, if a person is not doing any work—or if the person is only doing minimal work—for the income that he or she receives, this will not qualify as substantial work activity.
For example, a person may bring home $2,000 a month working at a family restaurant. But what if the person has severe intellectual disabilities and can only perform simple tasks at the restaurant? Even if the person makes $2,000 a month on paper, the amount that the person earns may be less. Put another way, there may not be a connection between the amount the person is paid and the work that the person contributes.
When there is not a connection between the amount a person earns and the work that they perform, some of the earnings may not count against the person for SGA purposes. In other words, the work that the person contributes is not worth what the person is paid. There are several ways to prove that earnings should not be countable, and it is best to consult with an attorney to find out if your work qualifies. If a person does not have countable earnings, some or all of their monthly earnings may not count as SGA.
So what happens when a person with a physical or mental impairment(s) tries to work but stops because of their physical or mental impairment(s)? Depending on how long the work lasts, an SGA exception might apply: the work might qualify as an unsuccessful work attempt or, if the person has been out of work for at least twelve months, a trial work period. Future posts will elaborate on these exceptions to substantial gainful activity.
If a person is not performing substantial gainful activity, then the person moves onto the second step of the sequential analysis: Does the person have a severe physical or mental impairment or combination of impairments that are severe? This step will be discussed in a future post.
If you have a severe physical or mental illness or injury, you should consult with an attorney experienced in Social Security disability for help and advice proving your case.