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✅ Why Passive Income Is Not Counted as Earned Income for SSDI: SSDI rules define earned income as income from work you actively perform — like wages, salaries, or self-employment where your physical or mental effort is required. 🧾 What IS Earned Income (Counted by SSDI): Wages or salary from a job Bonuses and tips Net profit from self-employment (when you actively manage or work in the business) 💸 What Is NOT Earned Income (Not Counted by SSDI): Dividends and interest Rental income (if you're not actively managing) Royalties Affiliate commissions (if you set it and forget it) Passive dropshipping income (if automated) Digital product sales (if minimal involvement) This means that passive income like: Etsy digital downloads Affiliate links Dropshipping (with a team or automated) Online course sales Dividend investing …can grow your income without affecting your SSDI as long as you’re not actively working full-time in the business. ⚠️ Caveat: If your passive income becomes more like a job — requiring daily activity, managing employees, or heavy customer support — SSA may reclassify it as self-employment, especially if you report it on a Schedule C with a lot of time invested. So, the less effort you put in day-to-day, the more safely it's considered passive. 💡 Tip: Keep a log of hours worked and document how much effort you put in, especially if your income increases. You want proof that you’re not engaging in Substantial Gainful Activity (SGA). Passive income —like income from dropshipping stores, digital products, rental properties, or investments—is typically not counted as “earned income” under SSDI (Social Security Disability Insurance) rules. Here’s why: 🔍 Definition of Earned vs. Unearned Income: Earned income: Wages, salaries, tips, or net earnings from self-employment (including active work in a business). Unearned income: Includes interest, dividends, rental income (if not actively managed), and other passive sources. Why Passive Income Doesn’t Count (Usually): No active work involved—if you’re not managing inventory, customer service, or product creation daily, it’s not considered a job. Dropshipping & digital products can be structured as passive if outsourced (e.g., using automation or virtual assistants). SSDI allows passive income, but if SSA believes you're actively working in the business, they may count it as earned. Caution: If your name is on the business and you’re working it daily, SSA may view it as substantial gainful activity (SGA). Keep good records showing limited involvement (e.g., hired help, automation tools). Structuring your business to stay passive Writing a letter to document your business model for SSA Tracking tools to help show minimal involvement Here's how to structure your passive income so it doesn't affect your SSDI benefits—and how to track it safely. ✅ 1. What You Can Earn While on SSDI SSDI allows you to receive passive income without limit, but earned income is restricted. In 2025, the monthly earned income cap is: $1,550/month (non-blind) $2,590/month (blind) Passive income (like from dropshipping store or digital guides) is OK as long as: You're not actively working more than a few hours a week You're not running daily operations You’re not earning a salary or taking wages from the business 🧩 2. Structure Your Business as Passive Here’s how to protect your SSDI benefits while growing your income: 🔹 a) Automate Your Online Business Use print-on-demand, dropshipping suppliers (no inventory) Auto-fulfill orders with platforms like Shopify + DSers or Printful Hire a VA (virtual assistant) for support, marketing, and customer service 🔹 b) Separate Ownership from Operations Form an LLC or single-member LLC Do not pay yourself a salary or hourly wage Take profit as passive business income (Schedule C on taxes) 🔹 c) Avoid Work That Looks "Active" Don’t respond to customer emails personally Avoid managing day-to-day marketing (delegate or use automation) Don’t post or manage ads yourself long-term 📒 3. Track Your Activity and Income SSA may ask questions about your business. Be ready with: 📌 Activity Log Keep a log showing how little time you spend on the business Example: “Check-in 1x per week for 15 minutes.” Use a Google Sheet to document weekly activities. 📌 Income Report Log your monthly profit and source: Ad income, product sales, affiliate sales, etc. Mark what’s passive (e.g., auto-fulfilled orders) 🛡️ 4. Add This Note to SSA If Asked: “My business is automated and managed by hired help. I am not actively involved in daily operations, and I do not pay myself wages or a salary. My role is minimal and does not constitute substantial gainful activity.”

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