You can collect both unemployment and Social Security, but how they interact depends on which Social Security benefit you receive

If you are receiving retirement benefits from Social Security, you can collect unemployment at the same time with no reduction to either payment. The two programs do not affect each other. However, if you are receiving Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI), collecting unemployment can reduce or stop your benefits because these programs have strict rules about work and income.

The key difference is that retirement benefits assume you have stopped working, while disability and SSI benefits are based on the assumption that you cannot work. When you file for unemployment, you are telling the government you are able and willing to work — which can conflict with a disability claim.

Key Takeaways

  • Retirement Social Security and unemployment can be collected together without either payment being reduced.
  • SSDI has a trial work period that lets you test employment for nine months without losing benefits, but ongoing work earnings above a certain amount will reduce or end your benefits.
  • SSI counts unemployment benefits as income and will reduce your monthly payment dollar-for-dollar once you earn above roughly $65 per month.
  • You must report any work or unemployment benefits to Social Security within 10 days of receiving them to avoid overpayment and penalties.
  • If you receive an overpayment because you did not report income, you may have to repay it, though you can request a waiver in some cases.

How SSDI and unemployment interact

If you receive Social Security Disability Insurance, you have a nine-month trial work period during which you can earn any amount and keep your full SSDI payment. This period is designed to let you test whether you can work without when ready losing your benefits. The trial work period counts only months in which you earn more than roughly $1,050 per month (this amount changes each year), so you can spread nine may have access to months across a longer calendar period.

After your trial work period ends, Social Security applies an earnings test. If you earn more than roughly $1,550 per month, your SSDI payment is reduced by $1 for every $2 you earn above that amount. If your earnings stay high, your benefits will eventually stop, though you enter a grace period called the extended may be able to access period where you can return to benefits quickly if your work ends.

Unemployment benefits themselves do not count as earnings for SSDI purposes — they are not wages. However, if you are collecting unemployment, you are stating that you are able to work, which Social Security may use as evidence that your disability has improved. If Social Security believes you can work, they may review your case and potentially end your benefits.

How SSI and unemployment interact

Supplemental Security Income is a needs-based program, meaning your payment depends on how much other income you have. Unemployment benefits count as income. Once you earn or receive more than roughly $65 per month in unearned income (which includes unemployment), your SSI payment is reduced by $1 for every $1 you receive above that threshold.

If you are working while on SSI, the first $65 of your monthly earnings are not counted, and then 50 percent of earnings above that are excluded. This is called the Plan to Achieve Self-Support (PASS) exclusion and gives you more room to work. However, unemployment benefits do not may have access to for this work exclusion — they are treated as unearned income and reduce your payment dollar-for-dollar.

Because SSI is means-tested, collecting unemployment while on SSI will almost certainly reduce your monthly payment. You need to report the unemployment income to Social Security to avoid an overpayment.

Reporting requirements and what happens if you don't report

Whether you receive retirement, disability, or SSI benefits, you must report any unemployment benefits to Social Security within 10 days of receiving them. You can report by phone, mail, or through your online Social Security account. Failing to report is not treated as fraud if it is an honest mistake, but you will still owe back any overpayment Social Security paid you.

If Social Security discovers you received benefits you were not may have access to to, they will send you a notice explaining the overpayment amount and your options. You can request a waiver of overpayment if you can show that you were not at fault for the overpayment and that repaying it would cause you hardship. The standards for a waiver are strict, but it is worth requesting if your situation qualifies.

Social Security can recover an overpayment by reducing your future benefits, asking you to repay in installments, or referring the debt to the U.S. Department of the Treasury for collection. The longer you wait to report, the larger the overpayment becomes.

Retirement benefits and unemployment have no interaction

If you are collecting Social Security retirement benefits, there is no earnings limit or income test once you reach full retirement age. You can work full-time, collect unemployment, or do both, and your Social Security payment will not change. This is true whether you are 62 or 85.

Before you reach full retirement age, Social Security does explore an earnings test to retirement benefits — for every $2 you earn above a certain amount, your benefit is reduced by $1. However, this earnings test does not explore to unemployment benefits. Unemployment is not counted as earnings because it is not wages from work.

If you are under full retirement age and working, you still need to report your work income to Social Security so they can explore the earnings test correctly. But unemployment benefits themselves will not trigger a reduction.

What to do before you file for unemployment

If you receive SSDI or SSI, contact Social Security before you file for unemployment to understand how it will affect your benefits. You can call 1-800-772-1213 or visit your local Social Security office. A representative can explain your trial work period (if you have SSDI), your current earnings record, and what will happen to your payment if you earn a specific amount.

If you receive retirement benefits, you do not need to contact Social Security first, but you should still report any unemployment income you receive within 10 days. If you are under full retirement age and working, report your work earnings so Social Security can explore the earnings test correctly.

Keep records of all unemployment payments you receive, including the dates and amounts. When you report to Social Security, you will need these details. If you receive an overpayment notice later, your records will help you dispute it or request a waiver.

Frequently Asked Questions

Will collecting unemployment stop my SSDI?

Not when ready. You have a nine-month trial work period where you can earn any amount. After that, if you earn more than roughly $1,550 per month, your payment will be reduced. If earnings stay high, benefits will eventually stop, but you can return to benefits quickly if work ends. The fact that you are collecting unemployment does not automatically end your benefits, but it may trigger a review of your disability status.

Do I have to repay Social Security if I didn't know I was supposed to report unemployment?

Yes, you will owe the overpayment. However, you can request a waiver if you were not at fault and repayment would cause hardship. Social Security reviews waiver requests case-by-case. The sooner you report the income, the smaller the overpayment and the stronger your waiver case.

Can I collect unemployment and retirement Social Security together?

Yes, with no reduction to either payment once you reach full retirement age. If you are under full retirement age and working, Social Security will reduce your retirement benefit by $1 for every $2 you earn above the annual limit, but unemployment benefits do not count as earnings for this test.

What is the trial work period and how long does it last?

The trial work period is a nine-month window during which SSDI recipients can earn any amount without losing benefits. It counts only months in which you earn more than roughly $1,050, so you can spread nine may have access to months across a longer time. After it ends, the earnings test applies and benefits are reduced if you earn above the monthly threshold.

How much unemployment can I receive before my SSI stops?

Your SSI payment is reduced by $1 for every $1 of unemployment benefits you receive above roughly $65 per month. If you receive $200 in unemployment, your SSI payment will be reduced by about $135. There is no point at which SSI stops completely due to unemployment alone, but your payment will shrink as unemployment income rises.