Does IHSS Income Affect SSI in California?
If you receive Supplemental Security Income (SSI) from Social Security and also earn money as an IHSS provider, you may be worried that your IHSS wages will reduce your SSI check. In many cases — particularly for live-in providers — they do not. Here is how the exclusion works.
The IHSS Income Exclusion for Live-In Providers
Under Internal Revenue Service (IRS) Notice 2014-7 and subsequent guidance, IHSS wages earned by a live-in provider are excluded from:
- Federal and state income tax (you do not owe income tax on these wages)
- SSI income calculations (these wages are not counted against your SSI benefit)
How Does This Help You?
SSI is reduced by $1 for every $2 of earned income above a small threshold. Without the exclusion, earning $1,000/month in IHSS wages could reduce your SSI by hundreds of dollars. With the exclusion, those IHSS wages are not counted, and your SSI remains unchanged.
Example
Maria lives with her elderly mother and earns $1,200/month as her mother's IHSS provider. Maria also receives SSI. Because she lives in her mother's home and is providing care to a parent, her IHSS wages are excluded from SSI income calculations. Her SSI benefit does not decrease.
What If You Are Not a Live-In Provider?
If you do not live with the recipient, the exclusion may not apply. IHSS wages for non-live-in providers are generally counted as earned income for SSI purposes and can affect your benefit.
In this case: SSI does apply an earned income exclusion — the first $65 of earned income plus half of the remainder is excluded. So $400 in IHSS wages would only reduce your SSI by approximately $167.50.How to Report IHSS Income to SSA
You must report your IHSS wages to the Social Security Administration regularly (monthly if you receive SSI). When reporting, note that wages are eligible for the live-in provider exclusion if applicable.
For help: Contact SSA at 1-800-772-1213 or visit ssa.gov. Tax help is available from VITA sites at 1-800-906-9887.