Working While on SSDI: What New Mexico Recipients Must Know

Working While on SSDI: What New Mexico Recipients Must Know

Many Social Security Disability Insurance recipients assume that accepting any work automatically ends their benefits. That assumption is wrong — and it costs people real money. The Social Security Administration has specific rules that allow SSDI recipients to test their ability to work without immediately losing coverage. Understanding those rules is essential for anyone in New Mexico navigating the balance between employment and disability benefits.

The Trial Work Period: Your Protected Window

The SSA provides every SSDI recipient a Trial Work Period (TWP) — nine months within a rolling 60-month window during which you can work and earn any amount without affecting your benefits. In 2024, any month in which you earn more than $1,110 (gross) counts as a trial work month. You do not need to use these months consecutively.

During your Trial Work Period, the SSA continues paying your full SSDI benefit regardless of what you earn. This is intentional — Congress designed the TWP specifically to encourage people to attempt a return to employment without the fear of immediate financial loss.

Once you exhaust all nine trial work months, you enter the next phase of evaluation. At that point, the SSA examines whether your work activity constitutes Substantial Gainful Activity (SGA). For 2024, SGA is defined as earning more than $1,550 per month for non-blind individuals, or $2,590 per month for statutorily blind recipients. If your earnings exceed SGA after your TWP, your benefits may stop.

The Extended Period of Eligibility

After your Trial Work Period ends, you enter a 36-month window known as the Extended Period of Eligibility (EPE). During the EPE, your SSDI benefits are not automatically terminated. Instead, the SSA monitors your earnings each month. In any month where your earnings fall below the SGA threshold, you receive your full benefit payment. In months where you exceed SGA, your benefit is suspended — not permanently terminated.

This distinction matters enormously. If you lose your job, your medical condition worsens, or you simply cannot sustain the work, your benefits can be reinstated during the EPE without filing a new application. For New Mexico recipients who may work seasonally — in agriculture, tourism, or construction — this flexibility can be a critical financial safety net.

If you earn above SGA for a full month after your EPE expires, your benefits will terminate. At that point, reinstatement becomes more complicated and typically requires a new application or an Expedited Reinstatement request within five years of termination.

Work Incentives That Apply in New Mexico

The SSA offers additional work incentives that many recipients overlook. These programs can significantly reduce the impact of working on your benefit amount:

• Impairment-Related Work Expenses (IRWEs): Costs you pay out of pocket for items or services that allow you to work — such as prescription medications, medical equipment, or transportation to medical appointments — can be deducted from your gross earnings when the SSA calculates whether you are performing SGA. For a New Mexico recipient who relies on regular specialist visits in Albuquerque or Santa Fe, these deductions can meaningfully lower your countable income.
• Subsidies and Special Conditions: If your employer provides you more assistance than a non-disabled employee would receive for the same job — extra supervision, modified tasks, or reduced quotas — the SSA may reduce your countable earnings by the value of that subsidy. This often applies to supported employment arrangements.
• Unsuccessful Work Attempts: If you begin working but must stop within six months due to your disabling condition, the SSA may classify it as an Unsuccessful Work Attempt. Those months may not count against your Trial Work Period at all.
• Plan to Achieve Self-Support (PASS): If you are working toward self-sufficiency through education or starting a business, a PASS plan allows you to set aside income and resources for that goal without having them counted against your benefits.

New Mexico residents can also access the New Mexico Division of Vocational Rehabilitation (DVR), which coordinates with SSA work incentive programs to provide job training, assistive technology, and placement services. Using DVR does not jeopardize your SSDI status and may qualify you for additional deductions under the IRWE program.

Reporting Requirements and Common Mistakes

Regardless of how much or how little you earn, you are legally required to report all work activity to the SSA. This includes part-time work, self-employment, contract or gig work, and in-kind compensation. Failure to report can result in overpayments that the SSA will demand back — sometimes years later — plus potential penalties for fraud if the SSA determines the failure was willful.

Self-employment is a particularly complicated area. The SSA does not simply look at your net profit. It evaluates your time, energy, and the value of services you provide to the business. A New Mexico recipient who starts a small business may find that even modest net income triggers an SGA determination if the SSA assigns a higher countable value to their labor contribution.

Report changes by calling SSA at 1-800-772-1213, visiting your local Social Security field office, or using your my Social Security online account. Keep copies of all correspondence. Document your earnings with pay stubs or invoices. If you receive a notice from SSA that you do not understand, do not ignore it — deadlines for appealing decisions are strict.

Protecting Your Medicare While Working

One of the most significant concerns New Mexico SSDI recipients have about working is losing Medicare coverage. Fortunately, Medicare does not end when your cash benefits stop. Under the Extended Medicare Coverage rules, once you have been entitled to Medicare due to disability, coverage continues for at least 93 months (about 7.5 years) after your Trial Work Period begins — even if your cash payments stop due to earnings above SGA.

After that extended coverage period ends, you may be eligible to purchase Medicare as a Medicare for People with Disabilities Who Work enrollee, often at a reduced premium. New Mexico also participates in the Medicaid Buy-In program, which allows working individuals with disabilities to maintain Medicaid coverage based on income — providing an additional layer of healthcare protection while you build toward greater financial independence.

Understanding exactly when your Medicare coverage could end — and planning around those dates — is one of the most valuable steps a working SSDI recipient can take. A disability attorney can map out that timeline specific to your benefit start date and work history.

Need Help? If you have questions about your case, call or text 833-657-4812 for a free consultation with an experienced attorney.

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