Wednesday, June 15, 2022

Do I Qualify For Social Security Income

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How Much Control Do You Want

Social Security Income when Qualifying for a Mortgage

As we don’t know what Social Security benefit payments will look like in the futuremany people expect them to be lower because of how the system is fundedyou may want to go with the sure thing and take the lower tax liability today. After all, one way to lower your tax liability is to take money out of your business and put it in one of the available retirement plans for the self-employed. That’s money you’ll have a lot more control over than Social Security benefits.

“The great thing about Social Security is you cannot access it until retirement age,” says Kevin Michels, CFP, EA, financial planner and president of Medicus Wealth Planning.

“You can’t make early withdrawals, you can’t skip payments, and you are guaranteed a benefit,” Michels adds. “However, you have only a small say in the future legislation of Social Security and how it will be affected by the mismanagement of government funds.”

Michels continues to say the following:

If you have trouble saving for retirement already, then paying into Social Security may be the better option. If you are confident you can stick to a savings plan, invest wisely, and not touch your savings until retirement, it may be a better idea to minimize what you pay into Social Security and take more responsibility for your retirement.

Some Incomesources Are Harder To Classify Than Others

This nice, conciselist will take care of 95% of all the types of income that exists. But thereare numerous other types of income that can cause confusion.

You might have back pay, bonuses, vacation pay, deferred comp, fiduciary fees, renewal commissions the list goes on. Unfortunately, we cant go through each of these in detail here because even the Social security administrations page lists 88 different types of income!

To confuse it evenfurther, there are some types of income thats not counted for employees, butit is counted for those who are self-employed.

You can take a look at that pageto learn moreabout how these different types of income are treated. Some of this income iscounted, some of this income is not counted but before you get too stressedabout this, remember that 95% of income sources are easily classified with oursimple list above.

Supplemental Security Income Overview


SSI stands for Supplemental Security Income. Social Security administers this program. We pay monthly benefits to people with limited income and resources who are disabled, blind, or age 65 or older. Blind or disabled children may also get SSI.


Many people who are eligible for SSI may also be entitled to Social Security benefits. In fact, the application for SSI is also an application for Social Security benefits. However, SSI and Social Security are different in many ways.


    Both programs pay monthly benefits.

    The medical standards for disability are generally the same in both programs for individuals age 18 or older. For children from birth to the attainment of age 18 there is a separate definition of disability under SSI. The medical standard is based on the severity of your disability financial need is not considered at this step in the eligibility process.

    SSA administers both programs.

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How Do Benefits Work And How Can I Qualify

While you work, you pay Social Security taxes. This tax money goes into a trust fund that pays benefits to:

  • Those who are currently retired

  • To people with disabilities

  • To the surviving spouses and children of workers who have died

Each year you work, youll get credits to help you become eligible for benefits when its time for you to retire. Find all the benefits Social Security Administration offers.

There are four main types of benefits that the SSA offers:

  • Learn about earning limits if you plan to work while receiving Social Security benefits

Why We Have An Earnings Limit

Printable Social Security Payment Calendar

Not long ago, a viewer on my YouTube channel asked me to give her a good reason why we have the Social Security earnings limit. The comments that followed showed how many viewers shared the belief that the earnings limit is unfair and should be eliminated.

In my response, I explained that the rationale behind the entire program of Social Security was to create a safety net. The original intent of the Social security program was not to supplement retirement income, but to keep the elderly out of poverty.

I also added that todays earnings limit is relatively generous compared to where the Social Security earnings limit began. The original Economic Security Bill President Roosevelt sent to Congress featured a very restrictive earnings limit.

That bill stated, No person shall receive such old-age annuity unless . . . He is not employed by another in a gainful occupation.

Whoa! This means that if you had even a single dollar in wages from a job, you could not collect a Social Security benefit at all.

Thankfully, the system we have in place today allows for individuals to have some earnings from work while they are receiving a Social Security benefit.

However, its very important to stay informed on the dollar amount of this limit because it changes every year.

For 2020, the limit is $18,240. For every $2 you exceed that limit, $1 will be withheld in benefits.

Again, once you reach full retirement age, there is no reduction in benefits regardless of your income level.

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Social Security Spousal Benefits Requirements

Based on actuarial studies, after a married couple reaches 65 years old, a majority of the time, one spouse will outlive the other by as much as 10 years. So the decision on who should file for benefits and when that should take place can have a major long-term impact on the income of a surviving spouse.

Spouses who never worked or have had low earnings throughout the course of their life are entitled to receive up to half of their spouses full retirement benefit. Depending on your personal situation, you may receive your own benefit or a blended amount of both you and your spouses benefit. Either way, you will receive a combination of benefits that gives you the highest possible amount.

One strategy often employed is for a spouse to take their spouses retirement benefit and delay taking their own benefit. By doing so, you can continue to accrue delayed retirement benefits which will result in a larger benefit amount when you file for your own retirement benefit.

How Do You Apply For Ssi Benefits

You can apply for SSI benefits in any of these ways:

  • Applying online through the Social Security Administration website
  • Contacting the Social Security Administration by phone
  • Visiting your local Social Security Administration office

It’s important to apply as soon as possible to get as much from SSI as you can. The program doesn’t pay benefits for any time before your application, even if you technically qualified for them.

You will need documents proving your identity, like your Social Security number and birth certificate. You’ll also have to prove your income. If you’re not sure what documents you need, contact the Social Security Administration to find out. It’s best to have as much of this documentation in order before you apply to speed the process along. But if you can’t track down some information, the Social Security Administration may be able to help you do so.

Those who are applying for benefits because they are blind or disabled will need to provide medical information proving this. If you don’t currently have a medical exam or test documenting your disability, the Social Security Administration will pay for you to receive this test. In some cases, it may also pay for your travel costs to get to the exam.

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What Kind Of Income Counts As Earnings

The Social Security income limit applies only to gross wages and net earnings from self-employment. All other income is exempt, including pensions, interest, annuities, IRA distributions and capital gains.

The term wages refers to your gross wages. This is the money that you earn before any deductions, including taxes, retirement contributions, or other deductions.

If you want to see a more in-depth conversation about what counts as income for the earnings limit, see my article on the Social Security Income Limit: What Counts as Income?

You Or Your Family Members May Be Eligible For Increased Benefits

SSDI, SSI & Retirement | Social Security Disability Insurance & Supplemental Income | theSITREP

Our mission is to deliver Social Security services that meet the changing needs of the public.

It’s not unusual for a benefit recipient’s circumstances to change after they apply or became eligible for benefits. If you, or a family member, receive Social Security or Supplemental Security Income , certain life changes may affect eligibility for an increase in your federal benefits. For example, if your spouse or ex-spouse dies, you may become eligible for a higher Social Security benefit.

To find out if you, or a family member, might be eligible for a benefit based on another persons work, or a higher benefit based on your own work, see the information about benefits on the Social Security website. You can also use the Benefit Eligibility Screening Tool to find out if you could get benefits that Social Security administers. Based on your answers to questions, this tool will list benefits for which you might be eligible and tell you more information about how to qualify and apply.

The questions and answers below are about a few of the life changes that could possibly increase your benefits.

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Certain Government And Railroad Employees

There are some jobs that dont pay into Social Security. Federal government employees hired before 1984 are included in the Civil Service Retirement System , which provides retirement, disability, and survivor benefits. These workers did not have Social Security taxes deducted from their paychecks and thus are not eligible to receive Social Security benefits.

They may still qualify if they have earned benefits through another job or a spouse. However, in these cases, CSRS pension payments may reduce Social Security payouts. Government workers who are covered by the Federal Employees Retirement System , which replaced CSRS, are eligible for Social Security benefits.

Most state and local employees have Social Security protection under a federal Section 218 agreement. However, some of these workersincluding those who work for a public school system, college, or universitywill not receive Social Security benefits if they do not pay Social Security taxes. They generally receive pension benefits from their employers.

How Much Will You Get From Ssi

The average SSI benefit is $585 per month, paid on top of Social Security retirement benefits. But the exact amount you’ll receive depends on the federal benefit rate and your income. As of 2021, the federal benefit rate is $794 for individuals and $1,191 for couples. But that doesn’t mean that’s how much you’ll get from the program. It’s just a starting point.

The government then subtracts your countable income from this benefit rate to determine your actual federal benefit. Here’s a guide to countable income for SSI if you’re interested in learning more about what income could affect your benefit.

Most states provide additional SSI benefits on top of the federal benefits to those who qualify. The only states and territories that don’t offer SSI supplements are:

  • Arizona
  • Northern Mariana Islands
  • West Virginia

Each state has its own formula for determining how large an SSI supplement you qualify for. Reach out to your state for more information.

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How Has The Covid

Working people with disabilities experience disproportionate job loss, compared to workers without disabilities, during economic downturns,39 and SSI applications generally increase when the unemployment rate increases . This trend held during the Great Recession and subsequent economic recovery.40 One exception to the general trend is the period from 2003 to 2007, when SSI applications continued to rise despite falling unemployment.41 Possible explanations for this anomaly include factors such as the lagged effect of federal welfare reform leading TANF enrollees to switch to SSI and persistently high poverty rates.42 The same study also found that the likelihood of applying for SSI significantly increases during extended periods of high unemployment.43

Figure 7: Percent change in SSI Applications Filed by Adults Ages 18-64 and U.S. Unemployment Rates, 1991-2019

How Does Social Security Affect Medicare And My Retirement Benefits


Although Medicare is a separate benefit offered by the government, it often times goes hand in hand with Social Security retirement benefits as a means of providing a financial safety net for retired workers.

Medicare is the government sponsored health insurance plan for people who are at least 65 years old. The only exceptions to this are the disabled or those who have permanent kidney failure, both of whom can get Medicare at any age.

Medicare is broken into four parts:

Medicare Part A Hospital insurance that helps pay for in-patient hospital care and some follow-up services.

Medicare Part B Medical insurance that helps pay for doctors services, outpatient hospital care and related medical services.

Medicare Part C Medicare Advantage Plans allow people to combine Part A and Part B to get medical services from a single provider organization.

Medicare Part D Prescription drug coverage helps pay for prescribed medications.

Medicare and Social Security benefits are linked in that when you turn 65 years old, your Part A Medicare hospital insurance begins automatically. If you live in the United States or U.S. territories, youll also be enrolled in Part B Medical insurance coverage as well.

Regardless of whether or not youre getting Social Security benefits, you should sign up for Medicare about three months before your 65th birthday.

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Do I Qualify For Social Security Income

Posted on: March 24 2014 / Written by: Dr. David Anaise

What is SSI?

SSI is Social Security Income. SSI makes monthly payments to people who have low income and few resources and are:

Age 65 or older

Blind or


Disabled or blind children also can receive SSI. The basic SSI amount is the same nationwide. However, many states add money to the basic benefit.

Whether you can receive SSI depends on your income and resources .

What Income qualifies me to receive SSI?

Income is money you receive such as wages, Social Security benefits and pensions. Income also includes such things as food, clothing or shelter. The amount of income you can receive each month and still get SSI depends partly on where you live.

Social Security does not count all of your income when SSA decides whether you qualify for SSI. For example, SSA does not count:

The first $20 a month of most income you receive

The first $65 a month you earn from working and half the amount over $65

Food stamps

Shelter you get from private nonprofit organizations and

Most home energy assistance.

If you are married, SSA also includes part of your spouses income and resources when deciding whether you qualify for SSI. If you are younger than age 18, SSA includes part of your parents income and resources. And, if you are a sponsored noncitizen, SSA also may include your sponsors income and resources.

If you are a student, some of the wages or scholarships you receive may not count.

Your car

Special Rules For People Who Are Blind Or Have Low Vision

We consider you to be legally blind under Social Security rules if your vision cannot be corrected to better than 20/200 in your better eye or if your visual field is 20 degrees or less, even with a corrective lens. Many people who meet the legal definition of blindness still have some sight and may be able to read large print and get around without a cane or a guide dog.

If you do not meet the legal definition of blindness, you may still qualify for disability benefits if your vision problems alone or combined with other health problems prevent you from working.

There are a number of special rules for people who are blind that recognize the severe impact of blindness on a person’s ability to work. For example, the monthly earnings limit for people who are blind is generally higher than the limit that applies to non-blind disabled workers.

In 2021, the monthly earnings limit is $2,190.

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What To Do Ifyou Get An Overpayment Notice From The Social Security Administration

Ifyou are under full retirement age and receive income from a source that is notone of the common ones we discussed above, youll likely receive a letter fromthe SSA alleging an overpayment.


Youdo need to communicate with theSocial Security Administration about this notice, or theyll turn you benefitoff but just because you receive a letter saying that the earnings testshouldve applied doesnt mean they are right.

Iveseen multiple cases in which all a client had to do was write a letter ofexplanation because the mistake was on the SSAs end.

Justbe aware that when it comes to the earnings test, the Social SecurityAdministration seems to use the same playbook as the IRS does when they have aquestion. Instead of sending you a letter to get clarification, they simplyassume they are right and tell send you a letter saying how much you owe inadditional taxes.

Forexample, if a client sells a stock and doesnt include the cost basis, the IRSjust assumes the entire amount of the proceeds should be a capital gain. Youhave to go back to them and tell them how much of the proceeds were the costbasis and how much represented an actual gain.

TheSocial Security Administration will often do something similar when it comes tothe earnings test and payments or income you received. Theyll send you anoverpayment letter that says something along the lines of,

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