You can get a tax refund on Social Security Disability Insurance (SSDI), but only if you paid taxes on it

Social Security Disability Insurance is taxable income in the eyes of the IRS, but only if your total income crosses certain thresholds. If you received SSDI payments during the year and your combined income (SSDI plus any wages, interest, or other money) was high enough, you may have owed federal income tax on part of those payments. If you paid that tax through withholding or estimated payments, you can get a refund just like anyone else—by filing a tax return and claiming back what you overpaid.

The catch is that most people on SSDI alone do not owe tax at all, so they have nothing to refund. You only owe tax if your "combined income" exceeds a base amount set by the IRS. Combined income means half your SSDI payments plus all your other income (wages, pensions, interest, dividends, rental income). For a single filer in 2024, the base is $25,000. For married filing jointly, it is $32,000. If you stay below that line, your SSDI is not taxable and you have no refund to claim.

Key Takeaways

  • SSDI is taxable only if your combined income (half your SSDI plus other income) exceeds $25,000 for single filers or $32,000 for married couples filing jointly.
  • If you owed tax on SSDI and had it withheld from your payments or paid it through estimated taxes, you can file a return to recover the overpayment.
  • The Social Security Administration does not withhold taxes automatically—you must request it on Form SSA-1099-SM or arrange it yourself through the IRS.
  • You will need your SSA-1099-R form (or SSA-1099-SM if you requested withholding) to file your tax return and claim any refund.

When SSDI becomes taxable income

The IRS uses a two-tier system to determine how much of your SSDI is taxable. First, calculate your combined income: take half of your SSDI payments for the year and add all other income (W-2 wages, 1099 interest, pension distributions, rental income, capital gains—everything the IRS counts as income).

If that combined income is less than your base amount ($25,000 single, $32,000 married filing jointly), none of your SSDI is taxable. If it exceeds the base, up to 50 percent of the excess is taxable. If your combined income is very high, up to 85 percent of your SSDI can be taxable. For example, a single filer with $30,000 in combined income would have $5,000 over the base; 50 percent of that ($2,500) would be taxable SSDI income.

This matters for refunds because if you had taxes withheld on SSDI you did not actually owe, or if you overpaid through estimated taxes, you get that money back. The refund comes from the IRS, not Social Security.

How to request tax withholding on SSDI payments

Social Security does not automatically withhold federal income tax from SSDI payments. If you want tax taken out before you receive your check, you must ask for it. You do this by completing Form SSA-1099-SM (Statement of Withholding Election) and submitting it to your local Social Security office or mailing it to Social Security.

You can request withholding of 7, 10, 12, or 22 percent of your monthly SSDI payment. Social Security will then reduce your check by that amount each month and send the withheld money to the IRS. At tax time, you report this on your return as federal income tax paid, and if you withheld more than you owed, you get a refund.

You can also change or stop withholding at any time by submitting a new Form SSA-1099-SM. If you did not request withholding but realize you owe tax on SSDI, you can pay estimated taxes directly to the IRS using Form 1040-ES, or you can wait and pay when you file your return.

Filing your tax return to claim a refund

To claim a refund on SSDI, you must file a federal income tax return even if you normally would not have to. You will need your SSA-1099-R form (or SSA-1099-SM if you had withholding), which Social Security mails to you by January 31 each year. This form shows your total SSDI payments for the year and any federal tax withheld.

You can file using tax software (IRS Free File if your income is below the threshold, or paid software), a tax professional, or by mail using Form 1040. On your return, you report the taxable portion of your SSDI as income, claim any tax you paid through withholding or estimated taxes, and calculate your refund. The IRS will send your refund by direct deposit or check, usually within 21 days of processing your return if you file electronically.

If you filed a return in prior years and did not claim a refund you were owed, you can amend those returns using Form 1040-X (Amended U.S. Individual Income Tax Return) going back three years from the original due date. This is useful if you only recently realized SSDI was taxable and you overpaid in earlier years.

What to do if you did not request withholding but owe tax

If you did not have tax withheld and you owe federal income tax on SSDI, you have two options. You can pay the full amount when you file your return in April (or whenever you file). Or, if you expect to owe tax again next year, you can start requesting withholding on your SSDI payments now using Form SSA-1099-SM, and also pay estimated taxes for the current year using Form 1040-ES.

Estimated taxes are paid quarterly (April 15, June 15, September 15, and January 15) directly to the IRS. You calculate what you expect to owe for the year, divide it by four, and send in each payment. This keeps you from owing a large bill at tax time and may help you avoid underpayment penalties if you owe more than $1,000.

Tracking your SSDI and tax records

Keep a record of your SSDI payments throughout the year. You can view your payment history on your my Social Security account online at ssa.gov. When you receive your SSA-1099-R in January, verify that the total matches what you received. If there is a discrepancy, contact Social Security before you file your tax return.

If you had withholding, your SSA-1099-SM will show the amount withheld. Make sure this amount is reported on your tax return as federal tax paid. If you paid estimated taxes, keep copies of your Form 1040-ES vouchers or confirmation of payment from the IRS. These records support your refund claim if the IRS asks questions later.

State income tax on SSDI

Most states do not tax SSDI, but a few do. If you live in Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, or Vermont, you may owe state income tax on SSDI even if you do not owe federal tax. Each state has its own rules about what income is taxable and what thresholds apply.

Check your state's tax agency website or speak with a tax professional to learn whether you owe state tax on SSDI. If you do, you may be able to request state withholding on your SSDI payments (the process varies by state), or you can pay state estimated taxes separately. Any state tax you paid can be refunded through your state tax return.

Frequently Asked Questions

Do I have to file a tax return if I only receive SSDI?

Only if your combined income exceeds the IRS threshold ($25,000 single, $32,000 married filing jointly) and you had tax withheld or paid estimated taxes. If you owe no tax and had no withholding, you do not have to file. However, filing allows you to claim any refund you are owed, so it is worth doing if you paid anything.

What if Social Security made a mistake on my SSA-1099-R?

Contact Social Security immediately and ask them to issue a corrected form. Do not file your tax return until you have the correct form. If you already filed and the form was wrong, you can amend your return using Form 1040-X once you receive the corrected SSA-1099-R.

Can I get a refund if I did not request withholding?

No, not unless you paid estimated taxes to the IRS. A refund comes from taxes you actually paid. If you owed tax on SSDI but did not have it withheld and did not pay estimated taxes, you owe the IRS when you file—you do not get a refund. Start requesting withholding now to avoid this next year.

How long does it take to get my refund?

If you file electronically and claim direct deposit, the IRS typically processes your refund within 21 days. If you mail a paper return, it takes longer—usually four to six weeks. You can track your refund status on the IRS website using the "Where's My Refund?" tool.

What if I owe back taxes on SSDI from previous years?

You can file amended returns for the past three years using Form 1040-X. If you owed tax and did not pay it, you may also owe interest and penalties, which the IRS will calculate. Contact the IRS or a tax professional to discuss a payment plan if you cannot pay the full amount at once.