I am 61 years old and have been on disability for 2 years. My wife still works full time. Last year my wife and I purchased 4 rental properties. Our accountant set up a LLC for us. For tax purposes I am listed at 99% and my wife 1% on the LLC. All repairs that have been done on the properties have been done by contractors and my wife does the monthly books on the properties. I am concerned if this will affect my benefits when I file my taxes. The LLC was created only to protect our liabilities. Could this be a problem? Thank you,
Hi. It shouldn't be a problem provided that you don't receive either a wage from the LLC or any income distributions that would be classified for tax purposes as self-employment income. Only earned income can affect Social Security disability benefits, and earned income is limited to either wages or self-employment income.
Rental income is normally not considered as earned income unless it's received:
a) In the course of a trade or business operated by a real estate dealer; or,
b) For the use or occupancy of rooms or other space where services are rendered primarily for the occupant (e.g. hotel or motel operators); or,
c) By a landlord who has an agreement with a farmer tenant in which the landlord materially participates.
Therefore, as long as any income you receive from the LLC is classified as unearned income, it shouldn't affect your SSDI benefits.
Best, Jerry