Hello-I suffer from a de-generative spinal disease and most likely will be receiving a federal disability in the future. I live in NC. Is it possible to have an entity for investment purposes if I am not drawing a salary but just building equity through a business? Perhaps an LLC or an SCorp. I would be using savings from the time I did work and am trying to grow it.
Any advice would be helpful because just like social security, I do not trust that disability money will be there long term for me and then what?
Thank you in advance.
I wish someone would have answered this question. My husband and I are both on SSD so this is something I'm concerned about also.
My other question is how to start investing when I rarely leave my house! There are (a lot of) days when I'm barely able to get around my own house, let alone go out and see other properties. And if we go to see any property that has steps - forget it.
I'll repost your question as a new post and maybe someone will have some answers.
Take care - from up here in Berks Co PA!
Hi @Karen Musselman . First, I'm sorry to hear that you are having such difficulty.I don't have an answer to the original question posted, but I do have a suggestion for you. In your particular case, I think you should consider a partnership with someone. If you can research areas that you are interested in, and come up with your general investing goals, you could use the forums to find someone with similar goals and reach out to them to see if partnering is a possibility. That person can help by being your "boots on the ground". For your part, you could try to figure out what you can bring to the table since you are not as mobile - can you be the one who makes the phone calls, manages the finances, finds potential deals online? I think you can make this work, but you will have to find creative ways to do it, given the circumstances.
While by far the best thing to do is to discuss your status with the SSD office. However, what I do know is that Social Security Disability Insurance looks at whether you can perform substantial gainful activity.
According to Social Security in regards to self employment [They] apply three tests to evaluate your work activity when you initially apply for SSDI and before you have received SSDI benefits for 24 months. [They] will also use the three tests to evaluate your work activity during the re-entitlement period to determine if we can reinstate your benefits in the Extended Period of Eligibility (EPE) (see EXTENDED PERIOD OF ELIGIBILITY). Your self-employment work activity is SGA if:
The Three Tests:
- You render significant services to the business, and you had average monthly earnings over the SGA level ($1,130 in 2016); or
- Your work is comparable to the work of persons without disability in your community engaged in the same or similar businesses; or
- Your work is worth more than the SGA level earnings in terms of its effects on the business or when compared to what you would have to pay an employee to do the work.
This should allow you to evaluate your own situation and determine if you are performing SGA in you business.
Great answers Karen and Cheryl - thank you!
We use an accountant for filing our taxes and he's fantastic. So whenever we get this business rolling, he'll help us determine how to set up the business financially to protect us and our assets. I get concerned that SSD isn't going to be around for much longer and I am allowed to earn up to $1200/mo before they take anything away.
I already went through one trial work period but since I averaged less than the allowable amount and worked from home, nothing was changed.
As for "boots on the ground," whenever I can go out, we go driving for dollars together and I research the properties at home. When I'm not able to go out, which is more often than not during the winter and summer, hubby goes out and gets photos for me.
I'm back in touch with an investor in my county again and she's going to help us when we find properties that look like a good deal. Again, I find the addresses and she has access to the MLS via family members who are agents.
We'll get there!
Oh, and to Randy: as for SSD and a business, your best bet is to get an accountant who is familiar with home-based businesses and SSD.
We have all of the papers ready to set up our business, but I want to see our accountant ahead of time to go over them to make sure it's done the right way for what we're doing. And LLC may seem right, but again, with the SSD and not wanting to lose any of that, especially the medical insurance, we might need to form the business in a different way.
My CPA recently told me that passive income - such as real estate- will not affect the amount of SSI that I will collect. I don't know about disability though.