What impact does earned income have on SSI cash benefits?

Earned income can indeed have a significant impact on Supplemental Security Income (SSI) cash benefits. When an individual receives earned income, it typically results in a reduction of their SSI benefits. This is due to the way the Social Security Administration calculates the benefit amount; they take into account any income an individual earns. There is a specific disregard amount for the first $65 of earned income each month, as well as a 50% reduction of any income over that amount. This means that as individuals earn more, their SSI benefits may gradually decrease, but they may still be eligible for some level of support.

The reasoning behind this reduction is to encourage individuals to work and to provide a financial incentive for earning income. Therefore, while SSI benefits might be diminished as earned income increases, individuals can still benefit from the combination of both income sources to improve their overall financial stability. This understanding helps clarify why reducing the SSI benefit amount in relation to earned income is an essential aspect of the SSI program.