Whether you must file taxes on SSDI depends on your total income, not just your benefits

Social Security Disability Insurance (SSDI) itself is not taxable income. However, you may have to file a federal tax return if your total income—including SSDI, wages, interest, dividends, or other sources—exceeds the filing threshold for your age and filing status. The IRS does not care that part of your income is SSDI; it cares about the total.

The threshold changes each year and depends on whether you are single, married filing jointly, or in another filing status. For 2024, a single person under 65 must file if their gross income is $14,600 or more. A married couple filing jointly, both under 65, must file if their combined gross income is $29,200 or more. If you are 65 or older, the thresholds are higher—$18,350 for single filers and $36,700 for married couples filing jointly.

Even if your income is below the threshold, you may want to file anyway. If you had taxes withheld from wages or other income, filing a return is how you claim a refund. If you received the Earned Income Tax Credit (EITC) in prior years, you may still be may have access to to it and should file to claim it.

Key Takeaways

  • SSDI payments themselves are never taxable, but you must count them toward your total income when deciding whether to file.
  • The IRS filing threshold for 2024 is $14,600 for single filers under 65 and $29,200 for married couples filing jointly, both under 65.
  • If you earned wages, had self-employment income, or received other income alongside SSDI, you almost certainly must file.
  • Filing is also required if you had taxes withheld from any income source, even if your total is below the threshold, because you may be owed a refund.
  • The IRS does not automatically know you receive SSDI, so the burden is on you to report your total income correctly.

How SSDI counts toward your filing threshold

When the IRS calculates whether you must file, it counts SSDI as part of your gross income. This means if you receive $12,000 in SSDI and earn $3,000 in wages, your gross income is $15,000—above the $14,600 threshold for a single person under 65 in 2024. You must file even though the SSDI portion is not itself taxable.

The same rule applies if you have other income sources. Interest from a savings account, dividends from investments, rental income, or self-employment income all count toward the threshold alongside SSDI. The IRS does not separate out the SSDI and ignore it; it adds everything together.

If you are married and file jointly, both spouses' SSDI and all other income are combined. If your spouse works and you receive SSDI, the household income includes both the wages and the SSDI when determining whether to file.

When you must file even if you are below the threshold

You must file a tax return if you had any federal income tax withheld from your paychecks, even if your total income is below the filing threshold. This is the most common reason people below the threshold file: they want to claim their refund.

You must also file if you are self-employed and had net earnings of $400 or more during the year. Self-employment income is subject to Social Security and Medicare taxes regardless of whether you owe federal income tax, and the IRS requires you to report it on Schedule C.

Additionally, if you received the Earned Income Tax Credit (EITC) in a prior year and still meet the income requirements, you may be may have access to to it again. You must file to claim the EITC; the IRS does not send it automatically.

What happens if you do not file when you should

If you are required to file and do not, the IRS may assess a failure-to-file penalty. The penalty is usually 5 percent of the unpaid tax for each month or part of a month that the return is late, up to 25 percent. If you owe no tax, there is no penalty, but if you are owed a refund and do not file, you straightforward do not receive it.

The IRS does not automatically know you receive SSDI. Social Security reports SSDI payments to the IRS, but the IRS does not cross-check this against individual tax returns to catch people who should have filed. However, if you have other income—wages, for example—your employer reports it to the IRS on a W-2, and the IRS may notice a mismatch if you do not file.

If you are unsure whether you must file, it is safer to file. Filing when you are not required to costs you only time; not filing when you are required to can cost you a refund or trigger penalties.

How to report SSDI on your tax return

SSDI appears on your tax return on line 5b of Form 1040, labeled "Social Security benefits." You do not pay tax on this amount, but you must report it so the IRS can calculate whether any of your benefits become taxable under the "combined income" test.

Combined income is calculated as your adjusted gross income (AGI) plus nontaxable interest plus half of your SSDI. If your combined income exceeds a threshold—$25,000 for single filers or $32,000 for married couples filing jointly—up to 85 percent of your SSDI may become taxable. This is rare for people receiving only SSDI, but it can happen if you have substantial other income.

You do not calculate this yourself. The IRS provides a worksheet in the Form 1040 instructions, or a tax preparer can do it for you. If any of your SSDI becomes taxable, it appears on line 5b as well, and you pay tax on that portion.

Filing options and where to get help

You can file your return on paper using Form 1040 and any necessary schedules, or you can file electronically using tax software or a tax preparer. The IRS Free File program offers free tax software to people whose income is below a certain threshold—$79,000 for most filers in 2024. You can access Free File through the IRS website at irs.gov.

If you cannot afford a tax preparer and do not want to use software, the IRS also operates the Volunteer Income Tax information (VITA) program, which provides free tax preparation at community centers, libraries, and other locations. To find a VITA site near you, visit the IRS website or call 211.

If you receive SSDI and have questions about whether you must file, you can contact the IRS directly at 1-800-829-1040. Have your Social Security number and SSDI benefit statement ready. Social Security itself does not determine tax filing requirements; that is the IRS's role.

State income taxes and SSDI

Most states do not tax SSDI, but a few do. Currently, Colorado, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, and Vermont tax SSDI under certain circumstances. The rules vary by state—some tax SSDI only if your total income exceeds a high threshold, and others have exemptions for people over a certain age.

If you live in one of these states and receive SSDI, check your state's tax agency website or contact them directly to learn whether you must file a state return. State filing requirements are separate from federal requirements, and you may have to file a state return even if you do not have to file federally, or vice versa.

Frequently Asked Questions

Can I get in trouble with the IRS for not filing if I do not owe taxes?

If you are not required to file and do not, there is no penalty. However, if you are required to file and do not, the IRS can assess a failure-to-file penalty even if you owe no tax. The safest approach is to file if you are unsure whether you must.

Do I have to report SSDI if I am below the filing threshold?

No. If your total income is below the filing threshold and you had no taxes withheld, you do not have to file. SSDI does not have to be reported to the IRS unless you file a return.

What if I earned wages and received SSDI in the same year?

You must count both toward your filing threshold. If your wages plus SSDI exceed the threshold for your age and filing status, you must file. Your employer will report your wages on a W-2, and you will report both the wages and SSDI on your return.

Will filing taxes affect my SSDI benefits?

Filing a tax return does not change your SSDI benefits. SSDI is not means-tested, so your income does not affect how much you receive. However, if you work and earn above the substantial gainful activity (SGA) limit, that can affect your benefits—but that is a Social Security rule, not a tax rule.

What if I did not file in prior years and now I am not sure if I should have?

You can file amended returns for prior years using Form 1040-X. If you are owed a refund, you generally have three years from the original due date to claim it. If you owe taxes, filing late may result in penalties and interest, but filing is still better than not filing.