This was a wonderful explanation of working while collecting; I've never seen the subject so well addressed before. It doesn't apply to me now, but it could soon. I found the explanation of where the money goes, when withheld from excess earnings, to be especially interesting and potentially useful. Thanks much.
I enjoy your videos very much and find the information very useful. One observation, the FRA for 1957 on the white board behind you should be 66 yrs. 6 months not 4 months. I'm a 1957 boomer so I know this age target very well. I'm planning to file for benefits at either 67 or 68 because I plan to keep working and want to avoid the take back penalty, also want to boost the monthly benefit a bit above the FRA amount.
John file at 67 You will be past your FRA and you can make as much as you want You May want to figure how much you would receive at 67 and how much the increase would be at 68 It May take you It may take 12 years to break even
I answered a lot of people's questions based on what I have learned from this channel and from studying the social security publication "How Work Affects Your Benefits." If any of my answers are wrong please bring that to my attention! I did it because Mr. Schmidt requested we chime in. Thank you so much for this channel Mr. Schmidt! I have learned a lot from you and have put it into action! I just received my first SS benefit check last week. I'm a dental hygienist still working 2 days per week, age 63. This comment was written in 2023. 🌞
The comments about H&R Block are true. After a 9 week, 2 evenings a week virtual course, you can get a job during the tax season working as much or as little as you want. It’s great.
Nice and clear explanation. I am thinking about starting Social Security benefits this year. I'll be 65 in October. I am self employed and looking at working some this year. I have two questions, the first in 2 parts: First, Can I still pay in to a retirement account to keep my monthly net income below the maximum $1,770 AND can I also collect dividends, capital gains, and or distributions from my IRA? Second, though I believe it was answer in your explanation, I wish to work more in the summer and not at all in the fall and winter months. Because income is looked at monthly vs annually I would still need to stay under the $1,770 during the summer. (Trying to think like a snow bird.) Thanks in advance.
I receive SS spousal benefits from my wife’s death on active duty a few years ago. I started collecting this year just before I turned 62. I retired in the Summer of 2021 and have worked some. I will take my full benefits at age 70. Nearly 30 years on active duty has taken its toll on me. Blessings.
😊Great video ~ nice to know that you can make $20k per year and you can still collect Social Security. Also great information regarding 401k withdrawals, they don't count as earned income. I am filing for Social Security in December so my first check should start in January, very very good information. 👍 Have a very Merry Christmas
Geoff, is this correct? SS is paid after the month earned, not for the upcoming month. In other words if Gary files in December, won't his SS start in January, but he won't receive first check until February & that could be as late as the the 4th Wednesday of February depending on where his Birthdate falls in the month. Is this correct?
I can't find the comment but, someone said they started SS just now so as not to miss out on 2023 8.7% COLA. Everything I read says not to worry about that... For example: "KEY POINTS Social Security will pay retirees a big cost-of-living adjustment in 2023. Some fear you need to claim now in order to get that raise. However, the calculations for future benefits also incorporate COLAs into the equation." Found more info on this... If one is 62 yet hasn't started receiving benefits the increases DO get added to one's future base. Complicated as are all aspects of SS..
Correct me if I'm wrong. The way I looked at it from my career field, ( Hourly Worker) was you take 21,000 ÷ 12 =1750 ÷ 4 = 437.5 ÷ 40 = $ 10.93 an he. If you don't wish to exceed the maximum allowable earned income, its late, but I think you get my point, an my math might be slightly off as I excluded the last 200 dlrs of the maximum allowable earned income. Thx for the vid Geoff.
They know by the amount of FICA that's withheld from your paycheck. Only WAGES count. If you own a rental and collect rental income or receive alimony, none of that counts. Just depends on how you earn the money.
The earning limit does not apply to you. Presuming you FRA was 67 (it is less in your case anyway) - the year you turned 68 and all of 69 , 70 etc.... and forward - no earnings limit.
I am FRA. I am still working and want to work for part/all of 2023. The letter I received from SSA said I can draw my SSI and I don’t have a cap amount. After seeing your video, I am scared of messing things up by drawing SSI until I do officially retire.
So otherwords pensions, i will have a military pension i have been receiving since my military retirement, and i will receive my social security, plus 50 % for a minor child and i am divorced. Of this is all i collect then i will have no earned income, is this correct?
I have now watched 4 experts explain this - 4 different ways - and 4 different results from what I see on the SS site. I am more confused now than ever.
Thanks so much for your videos. I will not take my SS until I turn 66 1/2, my FRA in September 2023. I will have earned $88,000 the month prior to taking my SS and retiring. Half the people I know say I will have to pay back 1/3 of my money over $56520 the other half say no penalty because I wasn't taking any SS. Who's right? Thanks
what happens when you start collecting and work until you reach the limit of 21,240 but you have a side business that you are running. How is the income from the side business that you are still doing figured in? Thanks for your reply.
At one point in your video, you described the rule where you owe 1 dollar for every 2 dollars you exceed the earnings limit yet in your example someone who goes 1 dollar over the limit ($1771) loses a whole month of benefits. Can you clarify this, please? The reason I ask is I have a website that earns passive income that fluctuates with retail shopping cycles which may cause me to go over the limit unexpectedly. I don't want to lose a whole month of benefits because my little website has a good month every once in a while. I don't want to kill it just to hold on to Social Security either so I need to know how to track the line in the sand.
This video has given me some insight to my retiring. I am 66 years old and hold a position as Operation Manager at a metal fabricating company. I know I am eligible for SS benefits but want to continue working. First; You stated in the video that once you pass the legal age for full retirement I can make as much as I want. Is there a limit as to how much I can make at this time. Second; I read a comment in another persons question. Can I add to my 401K to keep my income limit under what I need to report? Thank you for the help you have already given me and I hope you can help me more.
Great Video. I will be FRA in Feb and want to take my wife's benefit due to her passing. Based on this video I will not have any income issues. I would just like to confirm that and to ask about the tax issues around getting this payment.
Your SS is figured at 50% so if you were to receive say $25,000 a year that would be figured at $12,500 plus any other provisional income such as a pension IRA 401K eg you receive $30,000 that would be added to the $12,500 equals $42,500 Then after that you do the IRS calculation Bottom line your tax bill will be in the single digits next year
I plan on taking my Public Sector retirement May 5th, 2028 @65 years & 9 months after 32 years... I'll be cashing out 44 Days of Vacation in my May Check: If I understand this correctly: Using CURRENT figures: I'll have $30,825 in income. The Earnings limit is: $21240... so $9585 over the limit. 9585/2 is roughly $4793 in deferred benefits. Monthly benefit per SSA is $1788. So: June, July & $1217 of my August Benefits will be withheld.
I must be missing something here. At :40 you state: "...If you are in your FRA year there is a threshold of $56,520. Anything earned in excess of this amount you have to give back one dollar for every three dollars over that limit...". Then at 1:06 you state: "...After you reach FRA then you can earn as much as you want, there is no recapture provision.." These two statements appear to counteract each other. Can you or someone clarify? Thank you.
Hi. I will be retiring soon and your videos have been very helpful. On question I have, is what happens if you retire in the middle of the year and have not earned anything in the first six months but then earn 20K during the last 6 months of your initial year. Is that 20K considered under the Retirement Earnings Test or does the Monthly Earnings Test kick in? Looking forward to your response.
Hi Jeff, i went through this video a few times and I dont think im understanding: Im retiring at age 62 this (2023). My gross wages will be $4,0000/mo from January through 30 June., ie, earnings of 26,0000 for all of 2023 thereby exceeding my income limit by 4,760 ( for which i would expect a SS reduction of 50% or $2,380. Thats makes sense.’ However, i also plan to get my 1st $2,125 SS in march and every month thereafter.’ But march, april, may & june wages will be $4,000 / mo abd then zero for july -dec The video seems to imply that since i exceed the $1,770 test i would lose my entire social security chk of $2125 (loss of 2125 x 4 = 8500[ march-june] even though im only exceeding my annual earnings limit by $4,760 and of which i would really ‘owe’ 50% or $2,380… Have i lost $8500 in 2023 or $2,380 ?? Im fine with the annual earnings limit but am i not understanding something here ?? Thank you
Let me rephrase that, Under the first year retirement special rule, If you start collecting in the middle of the year Does the Monthly Earnings Test kick in automatically even if you have not earned anything yet or does the MET only kick in after you've earned more than the Earn Income Limit ? Hope to hear from you.
What is the definition of earnings? 'Net earnings from self-employment.' So, if I contribute to a Solo 401k, that should significantly reduce my net earnings and thus avoid the penalty?
I am 70 yrs old and I started collecting SS last Feb 2023, I planned to go back to work part time, will my SS benefit be deducted. I received $4007.00/month Thank you
I am classified by the U.S. Department of State as a "National" which is also identified as a Nonresident Alien by the IRS. As such, I am currently working full-time for a private company, and not the federal government. In the capacity of a "National" and a "Nonresident Alien, per the IRS I am not required to pay federal income tax. Subsequently my employer does not withhold for federal income tax. Question: How does this affect my social security benefits if I continue to work full time and collect social security at 62? Since I'm not taxed as a Nonresident Alien, I assumed I could work and generate as much income and not be penalized if I go above the income limits established by the SSA? I am fully vested in SS and American born. I have a U.S. passport and I'm also retired military.
Something I can never get an answer to: Do your Social Security benefits count as income. In other words, can I earn $21,400 ABOVE my monthly SSN benefits?
I have watched several youtube channels that give guides working and drawing social security and they all give figures and breakdowns for before FRA but non will give any figures for after you reach FRA.
Great info, I am trying to figure if I can go part time, keep my insurance and stay under the monthly income limit. I didn't realize the allowance had gone up. Thanks
You don't even have to stay under the limit, because they will withhold exactly the right amounts (as if you waited to file) and credit the withheld amounts to you later (as if you had waited to file). So you can receive benefits for a few months of the year when you earn somewhere between the cap and your full salary. The benefits are inversely proportional to the amount you earn in that window, of course.
I'll be 63 at the end of this year. I kind of figure I'll be working till the day I expire. Any ideas what the limits on allowable work income will be in 2024 based on previous criteria?
Great videos that you produce, thank you. I am considering taking SS now, just turned 65. I am self employed as a Realtor, with that business set up as an LLC. I pay myself using a payroll service. My question is, can I take $20,000 in payroll and collect social security, and any additional income stays in the LLC account to be used for business expenses. Will I be penalized if my LLC makes more than the allowed income for 2023?
My FRA occurs in 2023, specifically April 28th of 2023. Am I correct in assuming that unless I make more than the allowable $56,520 from Jan 1st through April 28th I am free to earn as much as I want for the rest of the year with no worries about the $1 for $3 penalty?
I had the same question. My thinking is why would SS use 12 months to figure out your penalty (if any) when you reached your FRA on the 4th month of the year.
I'm confused. On one hand, you say you owe 1 dollar for every 2 dollars over the earnings limit but in your example, if you go 1 dollar over the limit they keep a whole payment. Please clarify.
Good explanation but to be clear. If I were to start benefits at my FRA in September and continue to work. Will my wages this year be subject to the earnings limit or since I didn’t start until my FRA, no limit for this year applies?
I was going to wait until April2023 to take out survivor benefits, but I found out if I didn't start collecting in December2022 I'd miss out on that 8.7% increase!Thats almost $200 a month extra in my case! You should let people know if you are going to file for survivor benefits you will need both the Death AND Marriage certificate (certifide, of course. Mere Copies won't do). Hope this helps someone. PS - SSI told me unemployment benefits and Gambling winnings likewise will not count against your cap. Good to know if you live in Vegas like me!
@@oldtymer9106 You have to be 62 the year they announce the COLA increase If you were 61 and turned 62 the following year and started to collect you would not receive the COLA
Did you make a video by any chance for seniors who are retiring and then going to work for delivery companies that are in pending contractors? We’re writing off 80 to 90% of our income? How does that apply when you make a lot but your writing off all your mileage, which reduces your income massively?
My wife has been collecting benefits since 2/1/23. She doesn't reach FRA until 3/24, & wants to work for six months, beginning 10/1/23. How much money can she earn for those six months without being penalized?
Recently retired (65) and started drawing SS. Because I was a federal retiree the WEPed the Schmidt out of me. Was supposed to get $1401 and they reduced it to $921. I have the opportunity for a position that pays low 6 figures with a 401K. Is the earning limit based on taxable income? If I contributed as much as I can to the 401K will that help reduced the amount of income that is calculated for my SS max? My plan was to go to the local SS office and ask them to stop my SS payments. Advice?
I struggle to understand these rules. I am 63 and signed up for SSB to start in July so will get my first payment in August. I will have earned $30000 up until the end of June. I do not intend to work any more this year. As I earned roughly 9000 over the limit, will I have to pay half back, say $4500 for every two I earned over the limit?
Someone else asked the same question below. If you go over the limit and they apply the $1 for every $2 earned rule. Let's say you owe back $5K. Is that money they withhold the following year is a totally lost SS income? I thought you would get that money back after the full retirement age. Thanks,
No wait, capital gains doesn't count?!?!? So, if I make $50,000 a month trading stocks in a brokerage account, that doesn't count?!?!? REALLY?!?!? No penalty from S/S ?!?!? But I thought it is "treated as earned income" by the irs. I don't mind paying income taxes on it but I don't want it counted against my S/S income. I am receiving S/S but am 15 months away from FRA. Some clarification please!!!
I got a couple of questions about earning more than the earning limit. 1. How does ssa know how much I earned last month? I guess if I work for someone they report that monthly to ssa? How about if I work for myself? 2. When exactly does ssa take back the benefits over paid? The next month, next year? I can see this being a problem with intermittent work. I thank you in advance for your answers.
Probably stupid question. IF i Make $28,000 at my W2 job but lose $3,000 in my self employed job due to tax write offs like gas and rent and other things. Does Social security see my income as $25,000?? 64 yrs old
if you arent FRA can you earn $21240 in the the 1st 6 months and not earning anything the 2nd half without a penalty...so do they look at it monthly or annually? Also, I could take a 1099 job and they wouldnt know what month(s) I earned the money...this is often in Sales
I hope someone can answer these questions for me, please: I was born in 1960. I applied for SSI on Sept 19th, almost 3 1/2 months after my 62nd birthday. I still have not been notified if I will be getting benefits yet. Was I eligible to start collecting SSI at 62 and 3 1/2 months? When it finally goes through, do they retro it back to the date that I originally applied for it? If they drag their feet and do not authorize my benefits until the first of the year 2023, will I still get the 2023 increase, or will I miss out?
I'm starting a job next week. I'm working full time. I was born in 1957. They are paying me $17.00/ hr. I was 62 when I retred. I need to work how do I do this with my limit.
Hi , does income from rental property that I own count as income when I retire at 62 ? In other words can I be penalized for that rent income if I go over the limit ?
Question on FRA. Myine is 66 yrs and 10 months, I reach that on 11/20/2025. Does that mean on 11/20/2024 I enter my FRA year and earnings without penalty go up to $56,520 or would that start 1/01/2025?
I was born on December 27, 1957, My FRA according to the SSA is 66 /6months. So does that mean I can apply for benefits without paying a penalty if I do not exceed the 56k limit at 65 /6mo?
Yes I would like to know if I file for SS in February 2023 and my full retirement age is in January 2024 can I still make 56 thousand a year and not be penalized by ss
I love this channel and your presentations. You probably know this, but there is an exception for farmers and insurance people EN 05-10063 Special payments brochure explains this. The short version is because insurance sales people receive commissions from previous sales years in to the future, these renewals will not count toward the limit. I am taking my SS early 65.2 instead of 66.6 starting next year (health reasons) and discussed this with my local SS office. However this is the IRS and SS working together, keeping my fingers cross.🤞
I filed for my SSB at age of 62. This is how I beat the system. I started my benefits in the middle of the year and continued working thru the first 6 months of the following year. After 90 days I filed for unemployment and after 6 months of unemployment, I repeated the cycle. I was earning 20/hr, so I didn't have any SSB income limit issues. Plus I always got the Max unemployment benefits. The government screws us so we have to learn how to screw the government. In 2024 I will reach my full retirement age.
Except if you quit your job, you aren't eligible for unemployment. Your previous employer can contest it since it goes against their unemployment tax rate if you collect. What reason do you list for loss of job?
@@TheLiberty1999 U are correct if you quit however I never quit my contract accounting jobs. Also, unemployment rules are different by state. In Texas, it's really easy to get unemployment. I worked for a company in Texas for over 5 years they started to give me a hard time so I quit. I went to work for a temp agency and did a BS job for one week after the job was complete I called my temp agency to see they anything available and they told me no and on the 3rd day, I filed for unemployment and got unemployment benefits base on the previous job wages. I recommend my process for getting unemployment to all my friends in Texas and it never failed. However, years ago when I use to live in Georgia and I tried my process it didn't work. Georgia told me I had to earn 6 times my weekly benefit amount for I think 2 months to get unemployment.
@@TheLiberty1999 Playing dumb on job duties and responsibilities will get you unemployment too. The company probably will fire you but TWF will approve you for employment benefits.
You’re a prime example of what’s wrong with America. Gaming and manipulation of government programs for greed is the root of taxpayer abuse. You’ve provided tracable information in your posts which I’m passing along to my contacts in TWF.
Heres my question: 1.) i turned 62 in jan 2023. I will receive my 1st SS payment in march of Wowe and each month (march-Dec 2023h and 2.) I will have earning frommy employment from jan 2023 throughJune 2023 totalling $26,000 and I will have no additional employment earning fromjuly- december 2023. 1.) Will i have any of my social security from 2023 tKen away ? 2.) if so, how much? And 3.) when and how will that money be taken back. In 2024 and beyond i will limit my wage earnings tp the annual earning limit. im concerned about .this (2023) transition year. Thank you
I’m planning on retiring at 62 and continue to work. My income from employer will be over the $21,240 limit. I currently have 20% withheld from my check for 401k contribution. Can I just increase the amount that goes to 401k before taxes to stay under $21k limit ?
I'm a 60 y/o self-employed widow. One SSA doc says I have the Annual Earnings Test ($21k), and another says my survivor benefits are treated as though I'm FRA (no limit on income). Which is it? Also, how does SS know how many hours I work at my business (15-45 or more)? Are hours just self-reported? If I work >45 hrs in a single month, I have to pay that full month back?
Great information in your videos! Does passive income, such as income from rental units held in a trust, count towards your Annual Earned Income? Thanks
ALL of the videos I've watched concerning "working while collecting social security" refer to people under the ago of 70. In December 2023 I turn 70, will still be employed, and I want to begin collecting social security in January 2024. Will the SSA still penalize me for continuing to work, will they deduct $$ from my normal monthly social security check??
Love your videos! I am a bit confused: At 0:39 you say once someone reaches FRA the limit is $56,520 but then on time stamp 1:06 you say "once your reach FRA" there is no limit anymore!? What do I miss here?
@@Satjr35031 Broaden this statement. "you can make the $56520 year of your FRA once you reach your FRA no limit". This doesn't make sense. Can you clarify please.
@@rickjurado2398 Staring Next year the year before you reach FRA it will be $56,520 that you can make Receiving SS and not be penalized Once you reach FRA you can make a million does not affect your SS benefit
No, in the year you reach FRA, you are allowed to make as much as 56k before the month you reach FRA, rather than the monthly limit based on 21k in years prior. In the month you reach FRA and any months after there is no limit. Remember this is about being able to take Social Security “early” and what the monthly and yearly income limits are WHILE RECEIVING SS. if you are not receiving SS, there are no limits.
My and my spouse social security benefit started March 2022 at 64 as I was planning to retire soon. latter I changed my mind to retire because of the stock market and reported my income (60K) to SSA in August 2022. Since that my and my spouse social security benefit is suspended. We got 1099 from SSA. SSA website says “You do not currently have any over payment. Also, it says your benefit are suspended because you are working. My question is what about the money I received from SSA. Do I need to return it? Thank you
How is spousal benefits calculated? My wife started taking her SSI at 62 , I am planning to take mine at full retirement age, at that time 50% of my benefit will be more the what she is receiving will she see an increase of hers at that time to match the 50% level?
Can you apply for SSA prior to FRA, say this is January, my FRA is April of this year? The reason I ask this question is the date of your application will be in January 23.
Hi, I have a question: the month that I reach full retirement age, which in my case is February 2023, can I earn any amount of money from March 2023 on and not be subject to the earnings limit test? I would greatly appreciate an answer. Thank you.
My question is: in your example as a person income varies dramatically every month, How does IRS track our monthly income? Don’t they only have annual income reported at the end of the year?
