WORKING WORLD: Self-Employment

By Tamar Asedo Sherman

Self-employment is an option worth considering if you want to get back to work but don’t think you can handle the stress of going to and from an office, having to arrange transportation, possibly getting a personal care attendant to help you get ready, and maintaining regular business hours.

If you work for yourself, however, you have the flexibility to work when you feel like it, any time of day or night. You don’t have to worry about transportation, dressing up for the workplace or getting to your desk by a certain time.

You’re the boss and you can do what’s best for you. And if you receive SSI (Supplemental Security Income) or SSDI (Social Security Disability Income), you’ll have more wiggle room in reporting your income to Social Security, so you might be able to earn more and keep your benefits. Social Security applies different rules to the self-employed in calculating Substantial Gainful Employment (SGA), which is the most you are allowed to earn in a month and still maintain your benefits.

Only net earnings from self-employment count. That means you deduct all your business expenses from your gross earnings and multiply by 0.9235. In addition, you can deduct several kinds of personal expenses as well, such as impairment-related work expenses (IRWE), unincurred business expenses, and unpaid help.

IRWEs are costs related to your disability that allow you to work, such as: attendant care, transportation costs, medical devices, prostheses, work-related assistive devices and co-pays for medications, therapists, etc. Keep detailed records of all expenses and receipts. For an IRWE deduction to be allowable, the expenses must be paid by you and not reimbursed by another source, they must be paid in a month in which you work, and the expense must be reasonable.

Unincurred business expenses are supports given to you at no cost, such as equipment paid for by your state vocational rehabilitation division. For example, you might need modifications to your van to enable you to drive to work. If vocational rehabilitation provides you with hand controls and a lift to get your wheelchair into your van at a cost of, say, $6,000, you can deduct that amount from your earnings, rather than add it to your earnings, in calculating your net profit. Pretty good deal.

Some entrepreneurs with disabilities get start-up grants to help them launch business ventures. Take, for example, 53-year-old Ron of Pasadena, Maryland, who has limited mobility due to degenerative arthritis. He got a $15,000 grant from his state’s Reach Independence through Self-Employment (RISE) program (www.riseprogram.com), along with 8 weeks of training, to open a Coffee News franchise.

Furthermore, if you receive help in performing business-related tasks from friends, relatives or others without paying them for their services, like Ron does from his wife, you can deduct the fair labor cost of their assistance from your net earnings. Ron handles the sedentary jobs, all the bookkeeping, ordering and other paperwork, while his wife, who does not have a disability, handles the more active duties like distributing the products to 180 outlets each week.

Recognizing that entrepreneurship offers many advantages to people with disabilities, many states help people start their own businesses. The Brooklyn Economic Development Corp. has been offering an Entrepreneur Assistance Program which includes training in business management, bookkeeping, cash flow and marketing, for the past 20 years. Visit www.bedc.org for more information.

If you are thinking of starting your own business, your first step should be to contact the Small Business and Self-Employment Service (SBSES) at www.jan.wvu.edu/SBSES. It is sponsored by the Office of Disability Employment Policy of the U.S. Department of Labor www.dol.gov/odep.

SBSES provides information, counseling, and referrals about self-employment and small business ownership opportunities for people with disabilities. Call 800-526-7234 for further information. Those who are getting SSI can set aside income for a specified time to meet a work goal such as self-employment, but you must include a business plan.

Social Security rules regarding self-employment are vague and are interpreted differently by different officers. Some look at how many hours a week you work, others compare what you earn with what someone without a disability earns doing the same work, or they might consider the type of service you are offering to determine if you are performing Significant Gainful Activity.

But you do get a 9-month trial work period in which you can earn as much money as you want, then a 3-month grace period before benefits are cut off. Remember that only one-half of 1 percent of people who receive disability benefits ever leave the program.

Tamar Asedo Sherman works as an employment specialist at UCP-Suffolk in Hauppauge, NY. She can be reached at action@unitedspinal.org