Missed a great Ask Rusty topic? Don’t worry, we will help you catch up!
The first Friday of the month will feature Encore – Ask Rusty, with a select popular topic. Encore – Ask Rusty will often be accompanied by links to the original full-length article and/or audio, so please look for additional links in each post!
It’s often a surprise to those who wish to claim Social Security benefits before reaching their SS “full retirement age” (FRA) – there is a limit to how much you can earn from working while collecting early Social Security benefits. What will happen is that Social Security will look at your work earnings (as reported by the IRS) each year and, if you earned more than the annual limit, they will assess a penalty. The penalty is typically $1 in lost benefits for every $2 you are over the limit, which is recovered by withholding future benefits, usually creating a financial burden for anyone who depends on Social Security to pay their monthly bills. The earning limit is in force until you reach your SS full retirement age (somewhere between age 66 and 67, depending on when you were born), but catches many an unsuspecting early recipient of benefits. Which leads to this article based a question from someone who wonders why Social Security’s earnings test exists in the first place. A really good question, which Rusty answers in his own inimitable way.
To read the original Ask Rusty printed article posted on June 24, 2024, click on this link:
Or to listen to the audio podcast of the article, click here.
Questions? Please contact us at SSAdvisor@amacfoundation.org, or at 1-888-750-2622.
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Why can’t we require all people and business pay tax’s ,and at some level of crazy amount of money they be charged a 10% tax or give them a option the rest of us don’t get would be to allow them with over site by irs let them start a new business in the USA that they would make money on but put people to work . What ever tax’s are raised from people working give them a 5%break to the business owner a 5% break on there tax’s of total tax’s employees total is to deduct each year ,it should keep rising if they want the tax break or pay the 10% !
Hello Jim,
Thank you for your comments!
The $1 goes back to Social Security. If you had benefits withheld because of the overpayment Social Security will recalculate your benefit when you reach Full Retirement Age to account for the months of payments withheld.
Here at the AMAC Foundation we are not trained in taxes and therefore we are not aware of the interaction between Federal and State taxing agencies. Some states charge state income tax on Social Security. Most do not.
For proposed changes in IRS taxes you would contact your congressional representative.
You may contact us by emailing ssadvisor@amacfoundation.org or calling (888)750-2622.
Arlene Sharp, Social Security Advisor