How to Set Up an SSA PASS Plan for Work Goals

A Plan to Achieve Self-Support, called a PASS, is a written plan, approved by SSA, that lets you set aside income and resources to pay for a specific work goal. The money you set aside does not count when SSA decides whether you can get SSI or how much your SSI payment should be, so a PASS can shelter part of an SSDI check, wages, a pension, or savings and put that money toward tuition, tools, or starting a business.

The rules live in the SSI program at 20 CFR 416.1180 through 416.1182, with matching resource rules at 416.1225 through 416.1227. That matters for SSDI beneficiaries: a PASS does not change how SSA evaluates your SSDI work activity. It helps you by opening the door to SSI, or raising an SSI payment, while your SSDI is being set aside for the goal.

Who Can Use a PASS

Under SSA's Red Book, a PASS is for people who receive SSI, or who could qualify for SSI after setting aside income or resources to pursue a work goal. If your SSDI alone makes you ineligible for SSI, an approved PASS that shelters part of it can bring your countable income back into SSI range, and can also bring your resources back under the SSI limits through the exclusion in 20 CFR 416.1225.

If you could never qualify for SSI even with a PASS, the plan does nothing for you, because there is no SSI payment for the set-aside to protect.

The SSDI Connection

The regulation at 20 CFR 416.1180 spells out the kinds of income you can set aside: your own or a family member's wages, title II disability benefits, or pension income. SSI payments themselves are never set aside.

The Red Book gives the classic example: a person whose SSDI is above the SSI income limit uses part of that SSDI, under an approved PASS, to pay for school or training costs. Because the set-aside portion is no longer counted, the person can become eligible for SSI, use the SSI payment for living expenses, and spend the sheltered SSDI on the work goal. The trade is deliberate: the plan must aim at earnings that will substantially reduce or end your dependence on benefits, as 20 CFR 416.1181(a)(7) requires.

Filling Out Form SSA-545-BK

SSA prefers that you use its form, the SSA-545-BK. You can download it at www.ssa.gov/online/ssa-545.html, call 1-800-772-1213, visit a local office, or get one from a PASS Specialist. Anyone may help you complete it, including vocational counselors, social workers, and benefit specialists.

The form walks you through the plan contents the regulation requires. Under 20 CFR 416.1181(a), your PASS must:

• Be designed especially for you and be in writing.
• Have one specific employment goal that is feasible for you.
• Lay out steps toward the goal that are attainable, and show you will have enough money for living expenses while setting money aside.
• Show earnings from the goal big enough to substantially reduce or eliminate SSI, or to eliminate the need for title II disability benefits.
• Have a beginning date and a proposed ending date, plus target dates for milestones.
• List the expenses you will have and why they are reasonable and necessary for the goal.
• Show what income and resources you will set aside and how the set-aside money will be kept separate from other funds.

SSA must approve the plan, and any change to it must be approved too.

What a PASS Can Pay For

SSA's Red Book gives concrete categories: expenses for education, vocational training, assistive technology used for employment-related purposes, and starting a business. Tuition, books, and supplies for a degree or certificate program are the classic cases, and a startup PASS can cover equipment, stock, licenses, and similar one-time costs under the business plan rules described below.

The common thread is the regulation's requirement in 20 CFR 416.1181(a)(10) that every expense be reasonable and necessary for reaching the employment goal. Ordinary living costs, like rent or groceries, do not qualify, which is why the plan must also show you can meet living expenses from the money that remains outside the PASS.

Special Rules for Business Startups

If your employment goal is self-employment, 20 CFR 416.1181(c) requires a business plan as part of the PASS. The business plan must define the business, provide a marketing strategy, detail the financial data, outline operational procedures, and describe the management plan.

Set-aside funds for a startup can cover things like equipment, inventory, licenses, insurance, or short-term living costs while the business gets going, as long as SSA finds each expense reasonable and necessary for reaching the goal.

Keeping the Money Separate

The regulation requires that money set aside under the plan be kept separate from your other funds. In practice, that means a dedicated bank account used only for PASS expenses, with receipts kept for every purchase.

This separation is what allows SSA to exclude the funds. Money that disappears into your general spending, or that pays for things outside the plan, is not protected, and unapproved spending can put the whole plan at risk.

Review, Extension, and Endings

SSA's PASS Specialists are specially trained employees who review proposals. According to the Red Book, the Specialist checks that the work goal is reasonable, that you need the items and services listed, and that the prices are reasonable, then works with you on any needed changes. You can find PASS Specialist contacts through SSA's cadre page at www.ssa.gov/disabilityresearch/wi/passcadre.htm.

Under 20 CFR 416.1181(d), SSA reviews your progress at least annually. Under 416.1181(b), you propose a reasonable ending date, and SSA can adjust or extend it based on your progress and earnings.

The set-aside protection ends, and the income or resources start counting again, under 20 CFR 416.1182 and 416.1227, when you fail to follow the plan, abandon it, complete the time schedule, or reach your goal. None of those events is a penalty by itself; it just returns you to the ordinary SSI income and resource rules.

Before You Submit, Check the Plan Yourself

A proposal that fails the regulation's tests will come back with questions, so check it against 20 CFR 416.1181(a) yourself first. Is there exactly one employment goal, stated as a specific job or business? Are the milestone dates and the ending date realistic?

Does the expense list avoid anything you would have bought anyway? Does the math show living costs covered from remaining income? Is the set-aside money going into its own account from day one?

Answering those questions in writing before filing shortens the review, because those are precisely the items a PASS Specialist checks. If the goal later changes direction, remember that modifications go back to SSA for approval rather than being made quietly on your own.

A Note on Other Benefit Programs

The Red Book adds a practical bonus: other agencies may also disregard income excluded under a PASS when they decide eligibility for housing assistance or the Supplemental Nutrition Assistance Program. That can matter a great deal for household budgets while you are in school or launching a business.

Frequently Asked Questions

Can I fund a PASS with my SSDI check? Yes. 20 CFR 416.1180 specifically names title II disability benefits as income you may set aside under an approved PASS. The plan only helps you, though, if you receive SSI or could qualify for SSI once the set-aside is subtracted.

Where do I get the PASS form and where does it go? SSA prefers its Form SSA-545-BK, available at www.ssa.gov/online/ssa-545.html, by calling 1-800-772-1213, at a local office, or from any PASS Specialist. A PASS Specialist reviews the proposal with you before SSA approves it.

How often does SSA review an approved PASS? At least once a year. Under 20 CFR 416.1181(d), SSA reviews your progress at least annually, and under 416.1181(b) it can adjust or extend your ending date based on your progress toward the goal.

This article is general information about Social Security disability benefits, not legal advice. Program rules, earnings thresholds, and work incentives change over time, and every situation is different. Consult a qualified representative or contact the Social Security Administration directly for guidance on your specific case.