trading stocks or other while on social security disabilty

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Latest post 10-06-2009 8:51 AM by schlatko. 19 replies.
  • 06-29-2009 3:28 AM

    • jsw1
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    • Joined on 09-15-2007
    • NY
    • Posts 4

    trading stocks or other while on social security disabilty

    hello

    can you please answer the following or tell me where i might find the answers:

    would it be permissible to day trade or trade stocks or otherwise while receiving ssdi?
    what happens if the ssdi recipient makes a profit?
    what happens if the ssdi recipient makes a large profit?

    if this is a problem or would raise an alarm due to reports generated and sent to the irs and the ssa from the trading account?

    how about trading in an ira?


    would ira profits be not taxable, not reportable, and allowed until after 65 and only taxable and reportable at 65 or if the monies are withdrawn prior to 65?

    is it safe to assume once the recipient reaches 65 they automatically get regular ss and no longer ssdi?

    thank you very much for your kind attention

    please pardon the typing and format

  • 06-29-2009 9:30 AM In reply to

    Re: trading stocks or other while on social security disabil...

    There is no problem trading stocks while on SSDI.

    Your SSDI can end up being taxable depending on how much of a profit you make.

    http://www.4socialsecu...

    If you trade in an IRA you aren't taxed until you take a distribution. Distributions are always taxable as ordinary income and, again, depending on how large the distribution is, could make your SSDI taxable.

    jsw1:
    is it safe to assume once the recipient reaches 65 they automatically get regular ss and no longer ssdi?

    I would not assume that. You can go to the SSA website or call up the SSA for the answer to that question.

     

    • The right of the people 
    • to keep and bear arms,
    • shall not be infringed.
  • 06-30-2009 10:50 AM In reply to

    • Kivi
      Consumer
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    • Joined on 01-01-2005
    • CA
    • Posts 6,126

    Re: trading stocks or other while on social security disabil

    Bill Gates could collect SSDI, if he medically qualified.  Now, if you also qualify for SSI, you have a different issue.

    SSDI benefits convert to regular retirement benefits at your full retirement age, which is anywhere from 65 to 67, depending upon when you were born. The amount you receive does not change.  If SSDI is offset for workers' comp or another public benefit, that offset will go away with conversion.

  • 10-04-2009 12:41 AM In reply to

    • schlatko
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    • NY
    • Posts 10

    Re: trading stocks or other while on social security disabil

    hi everyone. i have been on ssdi since about 2 years and 6months ago. i was in a major car accident and got a large settlement. i have most of my money with this wonderful woman who has my money diversified. i am in bonds and stocks and i will earn about 20 k in dividends and all the stocks she has me in are doing great. prior to finding her i had major losses because a broker ripped me off and i made a good living. he took my account feom 150k to 20 k. it was horrible.

    anyway i kept 50k and opened up an account to try and day trade a little to keep my mind busy. i have 6 herniated discs, i have had 3 surgeries. 14 epidural steroid injections, 6 facet block injections. 2 plus years of physical therapy, trigger point injections every week and more. i still need 2 surgeries, but i just can't take any more.

    i have day traded that 50k into 70k and needless to say i have over 100k in carry forward losses. i have a long way to go.

    can i get in trouble by day trading on my bed? i need the income. i want to make sure my wife is taken care of. i am 44 and many years from a retitement age, but i am permanently disabled. i walk with a cane and wear a neck brace all the time.

    any help would be appreciated.

    thanks

  • 10-04-2009 12:51 AM In reply to

    Re: trading stocks or other while on social security disabil

    schlatko:
    can i get in trouble by day trading on my bed while watching cnbc?

    No.

    Other than the tax issues outlined earlier, your benefits are not at risk.

     

    • The right of the people 
    • to keep and bear arms,
    • shall not be infringed.
  • 10-04-2009 1:06 AM In reply to

    Re: trading stocks or other while on social security disabil

    adjuster jack:
    No. Other than the tax issues outlined earlier, your benefits are not at risk.

    I disagree with Jack. While the amount of income you have is not relevant to whether you can continue your SSDI, what kind of income it is does matter. If the income comes from work, that's a problem. The issue here is that day trading may be considered self-employment when conducted on a regular and continouous basis, which may then mean you no longer qualify for SSDI. You may wish to see a local attorney who practices in the area of SS disability to find out just how likely it is that your planned activity may be treated as work and thus affect your benefits.

  • 10-04-2009 1:49 PM In reply to

    • schlatko
      Consumer
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    • Joined on 10-04-2009
    • NY
    • Posts 10

    Re: trading stocks or other while on social security disabil

    oy vey. darn.

  • 10-04-2009 1:50 PM In reply to

    • schlatko
      Consumer
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    • Joined on 10-04-2009
    • NY
    • Posts 10

    Re: trading stocks or other while on social security disabil

    so the money that the lady makes me is of no issue. the money i make on my own is an issue. wow. i got pnzi'd i just want to get my money back.

  • 10-04-2009 2:00 PM In reply to

    • schlatko
      Consumer
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    • Joined on 10-04-2009
    • NY
    • Posts 10

    Re: trading stocks or other while on social security disabil

    ponzi'd is the correct word.

  • 10-04-2009 2:02 PM In reply to

    • schlatko
      Consumer
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    • Joined on 10-04-2009
    • NY
    • Posts 10

    Re: trading stocks or other while on social security disabil

    i do have this guy making some ideas for me. he has hardly made me any money, but i am gonna pay him 15% of any profits. if i paid him more can that help me?

  • 10-05-2009 12:21 PM In reply to

    • TSmith23
      Consumer
    • Top 500 Contributor
    • Joined on 08-13-2009
    • CT
    • Posts 90

    Re: trading stocks or other while on social security disabil

    see irs pub 550, p. 72.  special rules for traders in securities.

  • 10-05-2009 12:28 PM In reply to

    • schlatko
      Consumer
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    • Joined on 10-04-2009
    • NY
    • Posts 10

    Re: trading stocks or other while on social security disabil

    where do i get that?

  • 10-05-2009 12:33 PM In reply to

    Re: trading stocks or other while on social security disabil

    Check the irs website...www.irs.gov

  • 10-05-2009 12:38 PM In reply to

    Re: trading stocks or other while on social security disabil

    Publication 550 discusses the tax rules for when trading is a business. The SSA might use the same standard, it might not. That's why I suggest you see a lawyer who handles SSDI claims for advice.

  • 10-05-2009 12:44 PM In reply to

    • schlatko
      Consumer
    • Not Ranked
    • Joined on 10-04-2009
    • NY
    • Posts 10

    Re: trading stocks or other while on social security disabil

    i've already made a ton of trades. crap. maybe i'll just completely stop now. this stinks.

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