[Federal Register Volume 77, Number 184 (Friday, September 21, 2012)]
[Notices]
[Pages 58604-58606]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-23321]


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SOCIAL SECURITY ADMINISTRATION

[Docket No. SSA-2012-0023]


Social Security Ruling (SSR), 12-1p; Title II: Determining 
Whether Work Performed in Self-Employment by Persons Who Are Blind Is 
Substantial Gainful Activity and Treatment of Income Resulting From the 
Randolph-Sheppard Act and Similar Programs

AGENCY: Social Security Administration.

ACTION: Notice of Social Security Ruling.

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SUMMARY: We are giving notice of SSR 12-1p. This SSR explains our 
policy for evaluating whether work performed by self-employed persons 
who are blind is substantial gainful activity (SGA) under the 
disability program in title II of the Social Security Act (Act). In 
addition, this ruling clarifies that we do not count the income 
resulting from the Randolph-Sheppard Act and similar programs as 
earnings when we determine whether blind persons are engaging in SGA.

DATES: Effective Date: September 21, 2012.

FOR FURTHER INFORMATION CONTACT: Andrea Stoneham, Office of Program 
Development and Research, Social Security Administration, 6401 Security 
Boulevard, Baltimore, MD 21235-6401, (410) 965-6286, or, if you are 
deaf or hard of hearing, you may call our TTY number, 1-800-325-0778. 
You may also visit our Internet site, Social Security Online, at http://www.socialsecurity.gov.

SUPPLEMENTARY INFORMATION: Although 5 U.S.C. 552(a)(1) and (a)(2) do 
not require us to publish this SSR, we are doing so in accordance with 
20 CFR 402.35(b)(1).
    SSRs make available to the public precedential decisions relating 
to the Federal old-age, survivors, disability,

[[Page 58605]]

supplemental security income, special veterans benefits, and black lung 
benefits programs. We base SSRs on determinations or decisions made at 
all levels of administrative adjudication, Federal court decisions, 
Commissioner's decisions, opinions of the Office of the General 
Counsel, or other interpretations of the law and regulations.
    Although SSRs do not have the same force and effect as statutes or 
regulations, they are binding on all of our components. 20 CFR 
402.35(b)(1).
    This SSR will be in effect until we publish a notice in the Federal 
Register that rescinds it, or until we publish a new SSR that replaces 
or modifies it.

(Catalog of Federal Domestic Assistance, Program Nos. 96.001 Social 
Security--Disability Insurance; 96.002, Social Security--Retirement 
Insurance; and 96.004, Social Security--Survivors Insurance).

    Dated: September 7, 2012.
Michael J. Astrue,
Commissioner of Social Security.

Policy Interpretation Ruling

    Title II: Determining whether work performed in self-employment by 
persons who are blind is substantial gainful activity and treatment of 
income resulting from the Randolph-Sheppard Act and similar programs.
    Purpose: This Social Security Ruling (SSR) explains our policy for 
evaluating whether work performed by self-employed persons who are 
blind is substantial gainful activity (SGA) under the disability 
program in title II of the Social Security Act (Act).\1\ In addition, 
this ruling clarifies that we do not count income resulting from the 
Randolph-Sheppard Act and similar programs as earnings when we 
determine whether blind persons are engaging in SGA.
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    \1\ A person is blind if his or her visual impairment meets the 
definition of ``blindness'' in section 216(i)(1) of the Act. See 20 
CFR 404.1581.

    Citations (Authority): Sections 216(i) and 223(d) of the Act, as 
amended; (42 U.S.C. 416(i) and 423(d)); 20 CFR 404.1572, 404.1573, 
404.1575, and 404.1584; section 7 of the Randolph-Sheppard Act, as 
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amended (20 U.S.C. 107d-3); 34 CFR 395.8 and 395.32.

    Introduction: Under the disability provisions of the law, a title 
II disability beneficiary who performs SGA after the trial work period 
is not eligible for disability payments except during the first month 
he or she performs SGA, and the two succeeding months, whether or not 
he or she performs SGA in those months. We define SGA in the 
regulations as work that involves doing significant physical or mental 
activities and is the kind of work usually done for pay or profit. Work 
activity may be substantial even if the person does it on a part-time 
basis, or does less, is paid less, or has less responsibility than in 
previous work. Work activity by a self-employed person is gainful if it 
is the kind of work usually done for profit, whether or not the person 
realizes a profit. We generally do not consider activities such as 
self-care, household tasks, hobbies, therapy, school attendance, club 
activities, or social programs to be SGA. See 20 CFR 404.1572.
    Policy Interpretation: For work activity performed by blind self-
employed persons, we evaluate self-employment work activity based on 
whether the blind person has received a substantial income from the 
business and rendered significant services to the business.\2\
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    \2\ We apply this test to evaluate work activity performed by 
blind self-employed persons in 1978 or later. We use a different 
test to evaluate work activity performed by blind self-employed 
individuals prior to 1978. See SSR 83-34, ``Titles II and XVI: 
Determining Whether Work Is Substantial Gainful Activity--Self-
Employed Persons.''
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Substantial Income

    To determine whether a blind person has received substantial income 
from the business, we determine the blind person's countable income in 
the same manner as we determine the countable income of non-blind 
persons. We use the Internal Revenue Service rules to determine gross 
income, deductions, and net income from self-employment. We then deduct 
the reasonable value of any significant amount of unpaid help furnished 
by the person's spouse, children, or others, impairment-related work 
expenses (if they were not already deducted from gross income as a 
business expense), unincurred business expenses, and any soil bank 
payments (if such payments were included as income by a farmer). The 
income remaining after we make all applicable deductions represents the 
actual value of work performed and is the amount we use to determine 
whether the person has engaged in SGA. We refer to this amount as the 
blind person's countable income. See 20 CFR 404.1575(c) and 
404.1584(d).
    We then compare his or her countable income from the business with 
the dollar amounts in our published SGA earnings guidelines for persons 
who are blind.\3\ We generally adjust the SGA guidelines annually based 
on increases in the national average wage index.
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    \3\ Evaluation of a self-employed person's work activity for SGA 
purposes is concerned only with income that represents the person's 
own productivity. Therefore, before applying the earnings guidelines 
it is necessary to ascertain what portion of the individual's income 
represents the actual value of the work he or she performed. See SSR 
83-34. For 1978 and later, the law establishes SGA earnings 
guidelines for blind persons that are higher than the SGA earnings 
guidelines for non-blind persons. Section 335 of Public Law 95-216, 
91 Stat. 1509, 1547.
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     If the average monthly countable income of a self-employed 
blind person exceeds our SGA earnings guidelines for the applicable 
year, we will consider the person's work activity to be SGA, unless he 
or she has not rendered significant services to the business.
     If the average monthly countable income of the blind 
person is equal to or less than the SGA earnings guidelines for the 
applicable year, we will not consider his or her work activity to be 
SGA.

Significant Services

    If the countable income of a self-employed blind person exceeds our 
SGA guidelines for blind persons, we will consider whether he or she 
(if not a farm landlord \4\) has rendered significant services to 
determine whether the work activity is SGA. If the blind person 
operates a business alone, we consider any services rendered to be 
significant to the business. However, if the business involves the 
services of more than one person, we evaluate the actual services 
rendered by the blind person to determine whether they are significant. 
We will consider services significant if the blind person provides more 
than half the total time needed to manage the business, or more than 45 
hours a month regardless of the total management time the business 
required.
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    \4\ If a blind person is a farm landlord (i.e., you rent farm 
land to another) who materially participates in the production or 
the management of the production of the things raised on the rented 
farm, we will consider those services as significant. See 20 CFR 
404.1082, 404.1575(b)(2).
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Vending Machine Income Received by Blind Vendors Under the Randolph-
Sheppard Act and Similar Programs

    The Randolph-Sheppard Act established a program for persons who are 
blind to operate vending facilities as a business on Federal 
property.\5\ The income the blind vendor receives from the operation of 
the business is self-employment income. In addition, under the 
Randolph-Sheppard Act program, a blind vendor who operates a vending 
facility on Federal property may also receive income from vending 
machines that are located on the same property, even though the blind 
vendor does not

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service, operate, or maintain the vending machines.\6\
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    \5\ Randolph-Sheppard Act, as amended (20 U.S.C. 107 et seq.); 
34 CFR part 395.
    \6\ Section 7 of the Randolph-Sheppard Act, as amended (20 
U.S.C. 107d-3); 34 CFR 395.8 and 395.32.
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    Various states have established similar programs for persons who 
are blind to operate vending facilities as a business on state and 
local government property. Like the Randolph-Sheppard Act program, many 
of these State programs provide the blind vendor with income from 
vending machines that are located on the same property but are operated 
independently of the blind vendor's vending facility business.
    The income that blind self-employed vendors receive under the 
Randolph-Sheppard Act (and similar State programs) from vending 
machines that are located on the same property, but are not serviced, 
operated, or maintained by the blind vendor, is not a measure of a 
blind vendor's own productivity. It does not represent the actual value 
of any part of the blind vendor's work activity. Since the income a 
blind vendor receives under this provision of the Randolph-Sheppard Act 
(or similar State programs) is independent of his or her own vending 
business, and cannot be attributed to the blind vendor's own work 
activity, we will not consider this income when we determine whether 
the self-employment work activity is SGA. We will deduct this income 
from the blind vendor's net income before we apply the SGA earnings 
guidelines.
    Cross-References: SSR 83-34 Titles II and XVI: Determining Whether 
Work Is Substantial Gainful Activity--Self-Employed Persons; Program 
Operations Manual System sections DI 10501.015, DI 10515.005, and DI 
10515.010.

[FR Doc. 2012-23321 Filed 9-20-12; 8:45 am]
BILLING CODE 4191-02-P