Rental income counts as unearned income and reduces SSI payments dollar-for-dollar after the first $65 per month

If you receive Supplemental Security Income (SSI) and earn money by renting out property, that rental income will lower your SSI check. The Social Security Administration counts rental income as unearned income, which is treated differently from wages you earn by working. The first $65 of your monthly rental income is not counted. After that, every dollar you receive reduces your SSI payment by one dollar.

This rule applies whether you rent out a house, an apartment, a room, or land. It also applies to income from triple-net leases, where tenants pay property taxes and insurance. The only rental income that does not count is money from renting out a room in your home to a roomer who pays you directly — but only if you also live there and the payment covers only your share of household expenses.

Social Security looks at your rental income for the month you receive it, not the month the tenant's lease begins. If a tenant pays you three months' rent in one payment, all three months count as income in the month you receive the money.

Key Takeaways

  • Rental income reduces your SSI payment by one dollar for every dollar you receive above $65 per month.
  • Social Security counts the money in the month you actually receive it, not when the lease period covers.
  • You must report all rental income to Social Security within ten days of the end of the month you received it.
  • Expenses you pay to maintain the rental property do not reduce the income amount that counts against your SSI.
  • If you own rental property jointly with someone else, only your share of the income counts toward the SSI limit.

What counts as rental income for SSI purposes

Rental income includes any money you receive for letting someone else use property you own. This covers traditional rent from a tenant, but also includes payments for parking spaces, storage units, or land leases. If you own a duplex and live in one half while renting the other, the income from the rented half counts against your SSI.

Income from a room renter in your home is treated differently only if three conditions are all true: you live in the home, the roomer pays you directly (not through a property manager or lease agreement), and the payment covers only that person's share of household expenses like utilities and food. If the roomer pays more than their share, or if you do not live there, it counts as regular rental income.

Payments for furnished rooms, short-term rentals through platforms like Airbnb, and lease payments from businesses all count as rental income. If you receive a lump-sum payment for signing a lease or breaking a lease early, Social Security counts that as income in the month you receive it.

How expenses do not reduce your countable rental income

Social Security does not subtract property taxes, mortgage payments, repairs, maintenance, insurance, or property management fees from the rental income that counts against your SSI. This is a key difference from how the IRS treats rental income for tax purposes. For SSI, the full amount of rent you receive counts, regardless of what you spend to maintain the property.

If you pay a property manager to collect rent and handle maintenance, you still report the full rent amount to Social Security. If you make repairs to the rental unit, those costs do not reduce the income count. This means your SSI reduction is based on gross rental income, not net income after expenses.

The only deduction Social Security allows is if you own the rental property jointly with someone else. In that case, you report only your share of the income. If you own a rental house 50-50 with a sibling and receive $1,000 in monthly rent, you report $500 as your rental income.

How to report rental income to Social Security

You must report all rental income within ten days of the end of the month you received it. You can report by phone, mail, or online through your Social Security account. When you report, tell Social Security the amount of money you received, the date you received it, and which property it came from if you own multiple rentals.

Social Security will ask whether the income is expected to continue and, if so, for how long. If a tenant moves out and you do not expect to rent the property again for several months, tell Social Security that. If you have a long-term lease, tell them the monthly amount and that you expect it to continue. This information helps Social Security calculate your ongoing SSI payment.

Keep records of all rental payments you receive. Save bank deposits, checks, or payment confirmations. If you receive cash, write down the date and amount. These records help you report accurately and protect you if Social Security questions your report later.

When rental income affects your SSI payment

Social Security uses the rental income you report in the current month to reduce your SSI payment for the following month. If you receive $200 in rental income in January, your February SSI check will be reduced. The reduction is $135 — the $200 minus the $65 monthly exclusion.

If your rental income changes, your SSI payment changes the next month. If a tenant moves out and you receive no rent in March, your April SSI payment goes back to the full amount (minus any other income you have). If you acquire a new rental property and start receiving income from it, your SSI payment drops the following month.

Your SSI payment can be reduced to zero if your rental income plus any other income you have exceeds your SSI benefit amount. In 2024, the federal SSI payment is $943 per month for an individual, though your state may add more. If you receive $1,008 or more in monthly rental income, your federal SSI payment stops entirely.

Reporting changes in rental income

If your rental income increases or decreases, report the change to Social Security as soon as you know it will happen. If a tenant gives notice they are moving out, report that. If you raise the rent, report the new amount. If you acquire a new rental property, report it before you receive the first payment.

Social Security may contact you to verify rental income. They may ask for a copy of your lease, bank statements showing deposits, or a letter from your tenant. Have these documents ready. If you cannot produce proof of the income you reported, Social Security may reduce or stop your SSI payment and ask you to repay overpayments.

If you fail to report rental income and Social Security discovers it during a review, you may owe back payments. The agency can also impose a penalty. It is always better to report income promptly, even if it reduces your SSI payment, than to have Social Security find out later.

Rental income and other SSI rules

Rental income does not affect your SSI resource limit — the amount of money and property you can own and still receive SSI. You can own multiple rental properties and still receive SSI as long as your monthly income does not exceed the limit. However, the value of the rental property itself does not count toward your resource limit if you live in it. If you own a rental property you do not live in, its value does count as a resource.

Rental income is treated the same way whether you are receiving SSI only or receiving both SSI and Social Security Disability Insurance (SSDI). However, SSDI has different income rules. If you receive SSDI, rental income does not reduce your SSDI payment at all. Only earned income (wages from work) affects SSDI. If you receive both SSI and SSDI, the rental income only reduces the SSI portion.

Frequently Asked Questions

If I own a rental property with my spouse, do we both report the income?

Only the person receiving SSI reports their share of the rental income. If you and your spouse own the property 50-50 and you receive SSI, you report half the rental income. Your spouse does not report it to Social Security unless they also receive SSI. If you are married and both receive SSI, you each report your share.

What if I inherit a rental property — when do I start reporting the income?

You report rental income starting the month you receive the first payment from the tenant. Inheriting the property itself does not create income to report. Once a tenant pays you rent, report it within ten days of the end of that month. If the property is vacant when you inherit it, you do not report income until you rent it out and receive payment.

Does a security deposit count as rental income?

No. A security deposit is money held in trust and returned to the tenant when they move out. Social Security does not count it as income in the month you receive it. However, if you keep part of the deposit to cover damage or unpaid rent, that amount counts as income in the month you keep it.

Can I deduct the cost of repairs I made to the rental property?

No. Social Security counts the full rental income you receive, without subtracting repair costs, property taxes, insurance, or mortgage payments. This is different from how the IRS treats rental income for tax purposes. For SSI, report the gross amount of rent you received.

What happens if I sell the rental property?

Selling the property itself does not create income that counts against SSI. However, if you receive a payment from the buyer that is more than the sale price — for example, a bonus for closing quickly — that bonus counts as income. The sale proceeds go into your bank account and may affect your resource limit if the total savings exceed the SSI resource limit of $2,000 for an individual.