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National Center on Secondary Education and Transition
ESSENTIAL
TOOLS —
Handbook for Implementing a Comprehensive Work-Based Learning Program
According to the Fair Labor Standards Act (Third Edition)
Appendix C
SSI Work Incentives Available to Transition-Age Youth with Disabilities
Earned Income Exclusion
(EIE)
The Earned Income Exclusion applies to all SSI program recipients,
including any student earning wages from a school-sponsored employment
program or other employment. Under this exclusion, some earnings
each month are not counted toward the specified SSI income limit
($700). For many youth with disabilities, the Earned Income Exclusion
alone will ensure that most or all SSI benefits are maintained while
the student participates in school-sponsored paid employment or
other paid work situations.
There are three parts to this exclusion. The first is a general
exclusion of $20 of monthly income from any source. The second part
is an additional $65 earned monthly income exclusion. The third
part is the exclusion of one-half of all earnings above the combined
$20 + $65 ($85) monthly exclusion as well. That is, for every two
dollars earned, one dollar is deducted from SSI’s payment.
If, for example, an individual is receiving the maximum SSI benefit
rate of $500 per month, the individual’s monthly earnings
from paid employment would have to exceed $1,473 before the SSI
benefit would cease and the individual would exit the SSI program
if no other work incentives apply. This maximum income level would
increase if the individual accessed any of the other SSI program
work incentives. In addition to the Earned Income Exclusion, transition
students receiving SSI benefits may be eligible for and profit from
the following work incentives. |
Earned Income Exclusion Calculation |
| $420.00 |
Gross income (earned through competitive or supported employment)
|
| - 20.00 |
General income exclusion (unearned income, such as bank interest,
is deducted from the $20 exclusion) |
| 400.00 |
|
| - 65.00 |
Earned income exclusion |
| $335.00 |
|
| |
| 335.00 |
Divide this amount by 2 |
| ÷ 2 |
1/2 of income is deducted after exclusions |
| $167.50 |
SSI countable income |
| |
| $500.00 |
SSI Federal monthly benefit rate, 1999 |
| - 167.50 |
SSI countable income |
| 332.50 |
Adjusted SSI payment |
+ 420.00 |
Earned gross income |
$752.50 |
Total gross earnings |
Student Earned
Income Exclusion (SEIE)
Student Earned Income Exclusion (SEIE) allows a person with a disability
under age 22 and regularly attending school to exclude up to $400
of earned income per month before applying the Earned Income Exclusion.
The two exclusions may be used in combination. The maximum annual
exclusion is $1,620.
For example, a full-time college student with a disability receiving
SSI benefits of $500 monthly has the opportunity to earn $500 per
month while in school. These earnings may be excluded under SEIE
up to the $1,620 yearly maximum. In addition, the student may exclude
another $85 ($20 general exclusion; $65 earned income exclusion)
of monthly earnings, leaving him or her with a countable income
of $15. Please note that SEIE must be applied before the general
and earned income exclusions. SEIE can be used either with or without
the earned income exclusion. In this example, the student’s
gross income using SEIE is $485 (SSI) and $500 in earnings, for
a total of $985.
Students must apply for SEIE at their local SSA office. The student
must periodically submit a statement of school attendance, a statement
of employment, and wage receipts. Local SSA office procedures differ
slightly as to how often these statements are required. Students
should contact their local SSA office for complete details. |
SEIE Calculation |
$500.00 |
Gross income |
- 400.00 |
SEIE |
100.00 |
SSI countable income |
- 20.00 |
General income exclusion |
- 65.00 |
Earned income exclusion |
$15.00 |
SSI countable income |
|
$500.00 |
SSI Federal monthly benefit rate, 1999 |
- 15.00 |
SSI countable income |
485.00 |
Adjusted SSI payment |
+ 500.00 |
Earned gross income |
$985.00 |
Total gross earnings |
Impairment-Related
Work Expense (IRWE)
The cost of certain impairment-related items and services that
a person with a disability needs in order to work can be deducted
from gross earnings through an IRWE incentive. A student requesting
an IRWE must verify that the items or expenses incurred are related
to his or her disability and are necessary for job performance.
The student will be asked to submit proof of payment. Impairment-related
work expenses are deductible for SSI payment purposes when:
- The expense enables a person to work.
- The person, because of a severe physical or mental impairment,
needs the item or service for which the expense is incurred in
order to work.
- The cost is paid by the person with a disability and is not
reimbursed by another source.
- The expense is “reasonable” as it represents the
standard charge for the item or service in the person’s
community.
- The expense is paid in a month in which earned income is received
or work is performed while the person used the impairment-related
item or service.
Individuals with disabilities may rely on IRWE incentives throughout
their entire lives. Work-related expenses that are incurred by a
student while in secondary school are likely to continue when they
exit school. A student applying for an IRWE incentive under the
SSI program should contact the local SSA office for specific details
and documentation requirements. |
IRWE Calculation |
$420.00 |
Gross earnings |
- 85.00 |
General and earned income exclusions |
$355.00 |
Earned income |
- 360.00 |
IRWE exclusion |
0.00 |
Countable income |
|
$500.00 |
SSI benefits |
+ 420.00 |
Gross earnings |
$920.00 |
Gross income |
- 360.00 |
IRWE Expense |
$560.00 |
Usable gross income |
Plan for Achieving
Self-Support (PASS)
The Plan for Achieving Self-Support (PASS) is a work incentive
that allows an individual to set aside income and/or resources for
a specified period of time to achieve a work goal. For example,
an individual may set aside money for postsecondary education, the
purchase of job-coaching support, personal transportation, job-related
equipment, or to start a business. The income and/or resources set
aside in a PASS do not count in determining SSI benefits. Nor may
SSI cash benefits be used to support a PASS. When appropriate, a
PASS may be used in conjunction with other SSI work incentives.
If a student under age 18 cannot satisfy the SSI income eligibility
requirement only because his or her parents’ or guardians’
income is too high, the student may apply for a PASS incentive through
which their parents or guardians can set aside enough income to
make the student eligible for SSI benefits.
The PASS is similar to the IEP/transition plan: It establishes
job-related goals and objectives. Because of these similarities,
it is possible to incorporate a PASS into the IEP/transition plan.
A transition student may benefit from a PASS while in school or
upon exiting. The basic requirements for a PASS include:
- A feasible and reasonable occupational goal.
- A defined timetable.
- The need for income or resources, other than SSI benefits, to
be set aside.
- An explanation of expenditures to be covered by the set-aside
funds.
The PASS should be considered during the IEP/transition development
process even if it is not to be used while the individual is still
a student. A PASS may be used by any individual participating in
SSI at any age. Some students can benefit from a PASS while they
are in school and also after they leave school to further their
vocational goal by purchasing additional training or transportation,
for example. As part of the transition planning process, the planning
team may incorporate the future use of a PASS into the student’s
IEP/transition plan.
The most likely candidates for a PASS incentive are students who
currently are receiving SSI benefits, want to work and have work
goals in their IEP, are in school or a training program or plan
to complete postsecondary training, or plan to start their own business.
A PASS incentive can be used to support a number of expenses related
to employment goals, including:
- Tuition, fees, books, and supplies for school or training programs.
- Supported employment services, including a job coach.
- Attendant care.
- Equipment and tools needed to work.
- Transportation.
Income and resources that are set aside in a PASS are excluded
under the SSI income and resources tests. Any transition student
who receives SSI benefits or could qualify for them can have a PASS.
For example, a student whose income exceeds SSI requirements may
develop a PASS to maintain his or her SSI eligibility while pursuing
work goals.
To receive a PASS, an individual must complete a PASS application
and submit it to the SSA office. Each PASS is reviewed for approval
locally. This process can take up to three months to complete. Anyone
may help a student develop a PASS, including special education teachers
and other school personnel, vocational counselors, social workers,
employers, and private PASS vendors. A distinct advantage of a PASS
is that it allows the student to be proactive in securing necessary
training, support, or services to enhance employment opportunities.
|
PASS Calculation |
$658.00 |
Gross earnings |
- 85.00 |
General and earned income exclusions |
$573.00 |
Divide this amount by 2 |
÷ 2 |
|
286.50 |
Total countable income |
- 244.00 |
PASS |
$42.50 |
SSI countable income |
| |
$500.00 |
Federal benefit rate (1999) |
- 42.50 |
SSI countable income |
$457.50 |
Adjusted SSI benefit rate |
+ 658.00 |
Gross earnings |
$1115.50 |
|
- 244.00 |
PASS |
| $871.50 |
Usable gross income |
Blind Work Expenses (BWE)
SSA has special rules for people who are blind, including allowing them
to earn a higher income (Substantial Gainful Activity [SGA]) and still
maintain SSI eligibility. Blindness is defined as central visual acuity
of 20/200 or less, in the better eye with best correction, which has lasted
or is expected to last a year or longer. Blind Work Expenses (BWE) is
a work incentive that allows a blind person to deduct certain expenses
needed to retain employment from their earned income when determining
SSI eligibility and payment amount. For individuals who are blind, the
BWE work incentive is more advantageous than the IRWE. Examples of BWE
include: guide dog expenses; transportation; federal, state, and local
income taxes; social security taxes; attendant care services; visual and
sensory aids; translation of materials into Braille; professional association
fees; and union dues. When developing transition plans for students who
are blind, school personnel and parents should contact their regional
SSA office to get more specific information on SSA programs and benefits.
Property Essential to Self-Support (PESS)
PESS allows a person to exclude certain resources that are essential
to employment for self-support. For example, property that is used in
a trade or business or required by a person as an employee is totally
excluded when determining resources for SSI eligibility or payment determination.
While the PESS may have little application for secondary transition students,
it may have utility for some students when they enter the workforce. For
example, a student who is trained in carpentry may be required to supply
his or her own tools as terms of employment. Under a PESS the value of
these tools would not be counted as a resource.
For information on SSI and its work incentives, contact the Social Security
Administration, 1-800-772-1213.
The information provided in this appendix was adapted from “Meeting
the needs of youth with disabilities: Handbook on Supplemental Security
Income work incentives and transition students,” published October
1998 by the National Transition Network at the Institute on Community
Integration (UCEDD), University of Minnesota.
| Table of Contents
Introduction
Section
I
The Goal of Productive Employment for All Youth
The Work-Based Learning (WBL) Approach to Productive Employment
for Youth with Disabilities
Career Exploration
Career Assessment
Work-Related Training
Cooperative Work Experience
Requirements of the FLSA Related to WBL
The FLSA and WBL Career Exploration, Career Assessment, and
Work-Related Training Components
The FLSA and WBL Cooperative Work Experience Component
Section
II: Questions
and Answers
Requirements for Participation
Documentation
Program Supervision
Instructional Programming
The Educational Relationship vs. the Employment Relationship
Section
III: Case
Studies: Examples of Work-Based Learning (WBL) Activities
Example 1: Career Exploration in Initial Transition
Planning in a Rural Community
Example 2: Career Assessment Experience in a Cleaning Services Setting
Example 3: A Work-Related Training Experience in a Hotel Laundry
Setting
Example 4: Cooperative Work Experience in a Restaurant Setting
Example 5: Career Exploration in Two Suburban Business Settings
Example 6: Career Assessment in a Large Business Setting
Example 7: Work-Related Training in Three Workplace Settings
Example 8: Cooperative Work Experience at Special Minimum Wages
Appendix
A: U.S.
Department of Labor Employment Standards Administration Wage and
Hour Division Regional Contacts
Appendix
B: Organizations
Providing Assistance in the Planning of Transition Services for
Youth With Disabilities
Office of Special Education Programs Regional and Federal
Resource Centers
State Transition Contacts
Appendix
C: SSI
Work Incentives Available to Transition-Age Youth with Disabilities
Earned Income Exclusion (EIE)
Student Earned Income Exclusion (SEIE)
Impairment-Related Work Expense (IRWE)
Plan for Achieving Self-Support (PESS)
Blind Work Expenses (BWE)
Property Essential to Self-Support (PESS)
|
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Citation: Johnson, D. R., Sword,
C., & Habhegger, B. (2004). Essential tools: Handbook for implementing
a comprehensive work-based learning program according to the Fair Labor
Standards Act (3rd ed.). Minneapolis, MN: University of
Minnesota, Institute on Community Integration, National Center on Secondary
Education and Transition.
Permission is granted to duplicate this publication in its entirety or
portions thereof. Upon request, this publication will be made available
in alternative formats. For additional copies of this publication, or
to request an alternate format, please contact: Institute
on Community Integration Publications Office, 109 Pattee Hall, 150
Pillsbury Drive SE, Minneapolis, MN 55455, (612) 624-4512, icipub@umn.edu.
This document was published by the National
Center on Secondary Education and Transition (NCSET). NCSET is supported
through a cooperative agreement #H326J000005 with the U.S. Department
of Education, Office of Special Education Programs. Opinions expressed
herein do not necessarily reflect the policy or position of the U.S. Department
of Education Programs, and no official endorsement should be inferred.
The University of Minnesota, the U.S. Department of Education, and the
National Center on Secondary Education and Transition are equal opportunity
employers and educators. |
