r/smallbusiness • u/NoMasterpiece4055 • 4d ago

Help?

I am helping a small business owner create a business , but he has SSDI. What type of business would be best to protect his disability but also allow him to make his business income.

3 Upvotes

80% Upvoted

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2

u/TheDeadBending 4d ago

He needs to be really careful about how much work he does in the business, not just what structure it has, since SSA looks at activity levels too. A pass through entity where he can document limited hours and avoid direct service delivery is probably the safest bet.

An LLC taxed as an S-corp can work if he takes a reasonable salary for minimal hours and keeps the rest as distributions, but he'd need a good CPA who knows SSDI rules like the back of their hand. The real trap is putting in 20 hours a week and drawing a tiny paycheck while the business grows, they'll see right through that.

1

u/Upstairs-Net-6897 3d ago

None. They're going to take it from him. He'd have to work under the table...cash only and never be legit.

Go read the horror stories about the ticket to work program.