SSDI recipients received the 2020 stimulus payments, but the rules differed depending on how you filed taxes

The 2020 stimulus payments—formally called Economic Impact Payments—went to most SSDI recipients, but not all of them received the money the same way. If you filed a 2019 tax return, the IRS used that return to send you a payment. If you did not file taxes, the Social Security Administration sent you a payment based on your SSDI record instead. The amount was the same either way: $1,200 per adult and $500 per child under 17.

The key difference was timing and how you received the money. SSDI recipients who did not file taxes got their payments deposited directly into the same bank account where Social Security deposited their monthly benefit. Those who filed taxes received payments through whatever method they had chosen on their tax return—direct deposit, check, or debit card.

Key Takeaways

  • SSDI recipients automatically received a $1,200 stimulus payment in 2020 without having to take any action, whether or not they filed taxes.
  • If you filed a 2019 tax return, the IRS processed your payment; if you did not file, Social Security processed it using your benefit record.
  • Payments went to your existing bank account if you received direct deposit of your SSDI benefit, or by check if you received paper checks.
  • The stimulus payment did not count as income for purposes of SSDI benefit calculations or Medicare premiums.
  • Some SSDI recipients had to claim the stimulus as income on their 2020 tax return if they filed one, depending on their total income.

Why SSDI recipients did not have to file taxes to get the payment

Social Security maintains records of all SSDI beneficiaries and their bank account information for direct deposit. Because of this, the IRS and Social Security worked together to identify SSDI recipients who had not filed a 2019 tax return and sent them payments anyway. This was different from some other groups—for example, veterans who did not file taxes had to submit a straightforward form to receive their payment.

SSDI recipients were treated as a priority group because Social Security already had their address, identity verification, and banking details. The payment was sent automatically in May 2020 for most non-filers. If you received SSDI and did not file taxes, you did not need to do anything; the money arrived in your account.

How the payment was delivered to your account

The delivery method depended on how you normally received your SSDI benefit. If your monthly SSDI payment was direct-deposited into a bank account, your stimulus payment went to that same account. If you received your SSDI benefit by check, you received your stimulus payment by check as well.

Direct deposit payments arrived in May 2020. Paper checks were mailed starting in May and continued through the summer. If you had changed your bank account or address after your last SSDI payment, the IRS and Social Security used the most recent information they had on file. If the payment was returned as undeliverable, you could claim it on your 2020 tax return or contact the IRS.

Whether the stimulus counted as income for SSDI purposes

The 2020 stimulus payment did not count as income for SSDI benefit calculations. Social Security explicitly excluded Economic Impact Payments from the income rules that determine whether you continue to receive your full benefit. This meant that receiving the stimulus did not reduce your monthly SSDI payment, even if your other income was close to the limit.

The payment also did not count toward the Substantial Gainful Activity (SGA) limit, which is the earnings threshold that can affect your SSDI status. For 2020, the SGA limit was $1,260 per month. The stimulus payment did not push you over this limit or trigger a work-related review of your case.

However, the stimulus payment did count as a resource for purposes of Supplemental Security Income (SSI), a different program. If you received both SSDI and SSI, the stimulus could have affected your SSI payment if it pushed your total resources over the $2,000 limit. Most people who received SSDI alone were not affected by the resource limit.

Tax reporting if you filed a 2020 return

The stimulus payment was not taxable income, and you did not have to report it on your 2020 tax return if you filed one. However, if you filed a return and the IRS had not yet sent you your payment, you could claim it as a credit on that return. This was called the Recovery Rebate Credit.

If you did not receive your full $1,200 payment and did not know why, you could file a 2020 tax return to claim the missing amount. The IRS used your 2019 tax return (or 2018 if you did not file in 2019) to calculate what you should have received. If your 2020 income was lower than your 2019 income, you might have been may have access to to a larger payment, and you could claim the difference on your return.

What happened if you did not receive your payment

Some SSDI recipients reported that their stimulus payment did not arrive. The most common reasons were a change in bank account information that Social Security did not have on file, an address change, or a payment that was returned as undeliverable.

If you did not receive your payment by July 2020, you could check the status using the IRS "Get My Payment" tool on the IRS website. You could also contact Social Security directly to verify that your bank account information was current. If the payment had been sent but returned, Social Security could reissue it to a corrected address or account.

If you never received your payment and could not locate it, you could claim the Recovery Rebate Credit on your 2020 tax return. This required filing a return even if you normally did not file. The credit would be applied to any tax you owed, or you would receive it as a refund.

How the 2020 stimulus differed from later stimulus payments

Congress passed additional stimulus payments in December 2020 ($600) and March 2021 ($1,400). The rules for SSDI recipients were similar—the payments were not counted as income and were sent automatically—but the amounts and timing were different. The December 2020 payment was smaller, and the March 2021 payment required updated information about your income and filing status.

For the March 2021 payment, the IRS used your 2020 tax return if you had filed one, or your 2019 return if you had not. This meant that if your income had changed significantly between 2019 and 2020, your payment amount might have been different. SSDI recipients who had not filed taxes continued to receive payments automatically through Social Security.

Frequently Asked Questions

Did I have to pay back the stimulus if I received it by mistake?

No. The stimulus payments were not loans and did not have to be repaid under any circumstances. Even if you later discovered that you were not supposed to receive it, you could keep the money. The IRS did not pursue recovery of stimulus payments from any recipients.

Did the stimulus payment affect my Medicare premiums?

No. The stimulus payment did not count as income for Medicare premium calculations. Your Medicare Part B and Part D premiums are based on your Modified Adjusted Gross Income from two years prior, and the stimulus was excluded from that calculation.

What if I received SSDI and also had a job—did the stimulus count toward my work incentive limits?

No. The stimulus payment did not count toward the SGA limit or any other work-related earnings threshold. If you were using a work incentive like Impairment Related Work Expenses (IRWE) or Plans to Achieve Self-Support (PASS), the stimulus did not affect those calculations.

Could I claim the stimulus as a dependent on someone else's tax return?

If you were claimed as a dependent on someone else's return, the stimulus payment was still sent to you, not to the person claiming you as a dependent. You kept the money. This was different from the child tax credit, which goes to the person who claims the child.

Did the stimulus payment count as income for Medicaid purposes?

No. Most states excluded the stimulus payment from Medicaid income calculations. However, some states treated it as a resource if you had not spent it by the end of the month. If you received both SSDI and Medicaid, you should have checked with your state Medicaid office about how the payment affected your coverage.