One of the biggest differences between Supplemental Security Income (SSI) and Social Security disability insurance (SSDI) is that SSI is a needs-based disability program, while SSDI is available only to those who have worked a certain number of years. This means that a person applying for SSI must have an income and assets below a certain threshold in order to be eligible for disability benefits. The Social Security Administration's (SSA's) rules for determining a person's income are a common source of confusion for SSI applicants because not all income is counted.

Individuals with "countable income" over the federal benefit rate (FBR)—$735 for individuals and $1,103 for married couples, in 2017—are not eligible for SSI. Those who have some countable income, totaling less than the FBR, will have their monthly SSI payments reduced by the amount of their countable income. If an individual has absolutely no countable income and is approved for SSI, he or she will receive the total FBR each month.

Therefore, in order to determine whether you financially qualify for SSI and how much you might receive each month if your case is approved, you will need to know what kinds of income SSA considers to be "countable" and what kinds of income are exempt.

What SSA Does Not Count As Income

The first $20 of income you receive in a month is not counted, whether it comes from earned income (wages or self-employment income) or unearned income (like Social Security payments, unemployment benefits, or gifts). In addition, the first $65 of earned income, and half of all earned income over $65 each month, is not counted. Here are several more common services and payments which SSA does not count as income:

• Income tax refunds
• Cash loans or "in-kind" (non-monetary) loans that you have agreed to repay
• Grants and scholarships used for educational expenses
• Food stamps
• Medical care
• Home energy assistance
• Food or shelter provided by a nonprofit agency
• State or local needs-based assistance
• Disability-related work expenses
• Earned income of not more than $1,790 per month or $7,190 per year for students under 22 (in 2017)
• Money spent by others on your expenses, including your phone bills, utility bills, or medical bills (anything other than food and shelter).

This brief example may help to illustrate SSI's countable income rules:

Carla earns $80 per month babysitting a neighbor's child. She also receives $150 per month in food stamps, and her friend pays her phone bill of $25 each month. SSA would not count her babysitting proceeds as income due to the $20 income and the $65 earned income exemptions. Her food stamps would not count, and neither would the money her friend pays for Carla's phone bill. Carla's countable income would be $0 and, if approved for SSI, she would be entitled to the full federal benefit rate each month ($735 in 2017).

If instead Carla earned $175 babysitting per month, SSA would subtract $20, then subtract $65, then take half of that amount to get her countable income. (($175 - $20 - $65) ÷ 2 = $45) Her countable income of $45 would be subtracted from the federal benefit rate to calculate her monthly payment. ($735 - $45 = $690 per month) As you can see, the more countable income a person has, the less they will receive in SSI payments.

Other Factors That May Affect Your Monthly SSI Amount

There are two particular situations that many SSI recipients are surprised to learn can affect the amount of their monthly payment. The first applies to married SSI applicants living with their spouses, the second to those whose friends or relatives are giving them free room and board.

Married SSI Disability Applicants

For married SSI recipients living with spouses who do not receive SSI, Social Security will often count some of the income from the spouse not receiving SSI in determining the SSI amount. This is called "deemed income" and it applies to spouses earning over $368 a month. If the married couple has children in the home, the threshold increases $368 for each child. Not all of a spouse's income will be deemed, due to various exemptions, but it is possible that a spouse's income will disqualify a person from SSI benefits. (For more on spousal deeming, see disabilitysecrets.com's article  Will the Income of a Spouse Affect My Disability Benefits?)

Also, note that if both spouses are living together and receiving SSI, the total amount they will receive is less than if they were living separately. (The couples' rate for 2017 is $1,103 while the individual rate is $735.)

Help With Room and Board

Individuals receiving free (or reduced-cost) room and board may see their SSI benefits reduced by as much as one-third. However, if an individual can show that the room and board are loans, rather than gifts, the SSI benefits will likely remain unaffected. The best way to show this is to sign a contract promising to repay the value of what is received. This contract should be signed by the SSI applicant and the person providing the room and board, and it should be submitted to Social Security as soon as possible after you apply for benefits.

State Supplementary Payments

Some states pay an additional monthly amount to SSI recipients. This amount not only affects how much money you'll receive each month, but whether you'll qualify for SSI in your state. See our article on  SSI state supplements  for more information.

Countable Assets

Finally, note that Social Security looks at your assets in addition to your income to determine SSI eligibility, and it probably comes as no surprise that some assets, such as the house you live in, the car you drive, and many household goods and personal items, are not counted.

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