We are often asked by clients if income that they receive in the following situations will impact their claim for disability benefits.
- Renting a room in their home to a friend or family member
- Receiving income received from the rental of another property they own
The answer is dependent on the type of benefit they receive as well as what kinds of services they provide in return for the rental income.
How do I know if my rental income disqualifies me for Social Security benefits?
Directions on how earnings from the rental of real estate are to be considered is discussed in Social Security Ruling 85-18. This ruling directs that rental income is generally excluded and not considered to be “self employment” income unless someone is considered to be a real estate dealer. The analysis of who is considered to be a real estate dealer is based upon the types of services that are provided in the course of rentals.
In general, if you are merely renting properties and spending very little time providing minimal services such as upkeep of common areas ,the income will not cause problems with the receipt of disability benefits.
However, if the rental property provides more extensive, time-intensive services that are primarily in place for the convenience of the occupants (i.e.preparing meals for boarders or providing housekeeping or other services of that type), there may be a finding that your activity and income disqualifies you for benefits.
It is always wise to seek the advice of an attorney if you are concerned that your entitlement to benefits may be at risk. Contact Match and Farnsworth PC at 801-532-4556 for a consultation.