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How Do You Get Social Security Credits

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Work Credits And Quarters

Social Security Credits: How Many Do You Really Need?

At one time, Social Security work credits were also known as “quarters of work.” You had to earn the work credit amount in a single quarter , and could earn no more than a single credit in a quarter. That is no longer the case. You earn work credits on the minimum $1,360 of earnings no matter when or how frequently you earn them. Theoretically, you could earn four work credits in a single month in which you make $5,440. That would max out your work credits for the year, however.

When You Dont Have To Pay Social Security Taxes

You dont owe Social Security taxes on the portion of your wages that exceed a certain earnings threshold. The wage base for 2021 is $142,800 , and you dont owe Social Security taxes on the portion of your earnings that exceed that amount.

Lets say your annual earnings were $145,000. The percentage of taxes you owe would be applied up to the first $142,800 but not on the $2,200 above that. This annual cap on Social Security taxes also applies to employees who work for someone else.

What Kind Of Income Qualifies To Earn Social Security Credits

Not all of your income counts for purposes of determining how many Social Security credits you’ll get in a given year. Social Security looks only at “earned income” in its calculations. For most people, that includes wages and salaries. Tips are included in the mix as long as those tips get reported to the IRS. Certain benefits, such as vacation pay and severance pay, also go into the credit calculation.

Self-employment income is treated the same way as earned income is, especially since the self-employment tax paid by those who work for themselves includes both the worker and employer shares of the payroll taxes that go to fund Social Security.

One exception to the rules above applies to those who work for certain state and local government entities. Some of these government bodies elect to maintain their own pension plans as alternatives to Social Security. If they do so — rather than choosing to participate in Social Security voluntarily — then participants will typically get their retirement benefits solely from the government-run pension rather than through Social Security.

There are special rules governing what happens when someone works a portion of their career at such an employer and another part at a job covered under Social Security, but that typically affects the amount of the benefit checks that they’ll receive rather than their initial eligibility to get any benefits from the program at all.

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What Are Work Credits

Work credits are based on your annual income from a job or through self-employment. You can earn one credit per each quarter of the year and a maximum of four work credits yearly.

The amount of earnings to earn a work credit changes each year. In 2019, you need $1,360 in work or self-employment income to earn one credit. The maximum amount of income you would need to earn your four credits for the year is $5,440.

Special Rules For People Who Are Blind Or Have Low Vision

New or Replacement Social Security Number and Card

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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Your Insured Status Affects Your Eligibility For Benefits

Your insured status is the foundation of any benefit claim. You are considered insured when you have acquired a certain number of Social Security credits. These credits are also known as quarters of coverage. Since 1978, covered workers receive credits based on their annual earnings. Every year, the earnings necessary to earn one credit increase according to how much the national average wage has increased. In 2015, you earn one credit for every $1,220 in earned income, up to a maximum of four credits per year. Prior to 1978, an employee earned one credit for each calendar quarter in which covered wages paid were $50 or more . However, even if the employee received no wages in some of the quarters, he or she could still earn the maximum four credits if his or her total annual wages equaled or exceeded the maximum Social Security earnings base for that year.

How Many Social Security Credits Does It Take To Get Survivors Benefits

Social Security pays survivors benefits to qualifying family members after your death. Spouses can typically receive survivors benefits once they reach age 60 or if they’re caring for minor children, and minor children are usually eligible to receive survivors benefits based on their deceased parent’s work history.

Again, though, the deceased worker needs to have earned enough Social Security credits in order to allow their family members to qualify for these survivors benefits. The rules governing Social Security credits and survivors benefits are essentially a hybrid of the rules that cover retirement and disability benefits.

On one hand, if you’ve earned 40 Social Security credits, then your survivors will always be able to claim benefits. That’s the case regardless of when during your career you earned those credits or how long it’s been since you worked regularly.

On the other hand, even if you haven’t reached the 40-credit threshold at the time of your death, your loved ones can still qualify for survivor benefits under certain circumstances. As long as you had earned at least six Social Security credits looking back over the past three years as of your date of death, then survivors benefits will be available to a spouse or child even without 40 total credits in your career.

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Your Monthly Social Security Benefits Grow The Longer You Wait To Claim

You can collect Social Security benefits as soon as you turn 62, but taking benefits before your full retirement age results in a permanent benefits reduction of as much as 25% to 30%, depending on your full retirement age.

If you wait until you hit full retirement age to claim Social Security benefits, youll receive 100% of your earned benefits. Or you can keep waiting to claim your Social Security benefits all the way to age 70. There’s a big bonus to delaying your claim — your monthly Social Security benefit will grow by 8% a year until age 70. Any cost-of-living adjustments will be included, too, so you don’t forgo those by waiting.

Waiting to claim your Social Security benefits can benefit your heirs as well. By waiting to take his benefit, a high-earning husband, for example, can ensure that his low-earning wife will receive a much higher survivor benefit in the event he dies before her. That extra income of up to 32% could make a big difference for a widow whose household is down to one Social Security benefit.

Getting A Social Security Number For A New Baby

Applying for SSDI After Your Social Security Credits Have Expired: Yes You Can

The easiest way to get a Social Security number for your child is at the hospital after they are born when you apply for your childs birth certificate. If you wait to apply for a number at a Social Security office, there may be delays while SSA verifies your childs birth certificate.

Your child will need their own Social Security number so you can:

  • Claim your child as a dependent on your income tax return
  • Open a bank account in their name
  • Get medical coverage for them
  • Apply for government services for them

Keep your Social Security card in a safe place to protect yourself from identity theft.

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Find Out Your Estimated Social Security Benefits

Periodically checking your estimated Social Security benefits serves several purposes: It helps you plan for retirement and allows you to check for and correct errors.

The Social Security Administration keeps a database of your earnings record and work credits, tracking both through your Social Security number. You can see this information on your Social Security Statement, which is available to everyone age 25 and over. The Social Security Statement also gives you an estimate of the benefits you’ll receive at retirement age, which can play an important role in your financial planning.

How To Receive Federal Benefits

To begin receiving your federal benefits, like Social Security or veterans benefits, you must sign up for electronic payments with direct deposit.

If You Have a Bank or Credit Union Account:

  • Call the Go Direct Helpline at .

If You Don’t have a Bank or Credit Union Account:

Make Changes to an Existing Direct Deposit Account:

Learn how to make changes to an existing direct deposit account. You also may contact the federal agency that pays your benefit for help with your enrollment.

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Whats Required To Get Social Security Credits

Social security credits are earned over ones lifetime as they work and pay into the system through their Social Security taxes. As of 2020, the minimum threshold to earn a credit is $1410, with a maximum of four credits that can be earned per year. Even someone who earns as little as $5,640 in a year would still be able to earn their four credits.

For most, this feat is easily achievable. But for othersdue to mitigating circumstancesit is possible to fall short, and end up with not enough credits for Social Security retirement. If you are near retirement age and find yourself still under the Social Security 40 credits minimum, it can feel very frustrating.

Some people wonder, Can I buy Social Security credits? The answer is no. Social Security credits cannot be bought. They must be earned by working a qualified wage throughout your work history.

How Minimizing Taxes Minimizes Benefits

How to get a lost Social Security card replacement

There are many business expenses that can reduce your tax liability besides the Social Security tax deductions you can take when youre self-employed.

Business expenses reduce your overall tax, which ultimately lowers your Social Security taxes. Business tax deductions are a way of minimizing self-employment tax and Social Security taxes, says Carlos Dias Jr., founder and managing partner of Dias Wealth LLC in Lake Mary, Fla.

But keep in mind that this can work against you when it comes to Social Security benefit calculations, which are based in part on your taxable earnings. Here’s why. The more deductions you have, the lower your Schedule C income. Lowering your Schedule C income is a good way to reduce how much federal, state, and local income tax you owe. However, this lower amount becomes part of your Social Security earnings history and means you may receive lower benefits in retirement than if you didnt take those deductions.

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Factors That Affect How Much You’ll Get In Retirement

Most retirees rely on Social Security. One in four gets 90% of their retirement income from the program. About half rely on it for 50% of their income.

Although Social Security is only one part of a secure retirement plan, it’s helpful to get a rough idea of how much you can expect. If you’re eligible for Social Security, your monthly benefit is based on two factors:

  • How much money you earned during your working career
  • The age you choose to start getting payments

Let’s look at how each of these affects your future Social Security income.

Social Security Credits Required For Medicare

Technically, there are no credits required for Medicare. The credits for Medicare purposes simply reduce, or eliminate, your Part A premium. The chart below lists the part A premium amounts for the corresponding Social Security credits.

For part B, everyone pays a premium. For most, it is $148.50 per month . However, its important to note that the premiums are higher for individuals over certain income amounts.

There are a few other exceptions to receiving free part A Medicare. See the Medicare website for more information.

As with retirement benefits, you may qualify for free part A Medicare on a spouses work record.

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Adults Disabled Before Age 22

An adult who has a disability that began before age 22 may be eligible for benefits if a parent is deceased or starts receiving retirement or disability benefits. We consider this a “child’s” benefit because it is paid on a parent’s Social Security earnings record.

The disabled “adult child” including an adopted child, or, in some cases, a stepchild, grandchild, or step grandchild must be unmarried, age 18 or older, have a disability that started before age 22, and meet the definition of disability for adults.


It is not necessary that the disabled “adult child” ever worked. Benefits are paid based on the parent’s earnings record.

  • A disabled “adult child” must not have substantial earnings. The amount of earnings we consider “substantial” increases each year. In 2021, this means working and earning more than $1,310 a month.

Working While Disabled: How We Can Help

Your Social Security Benefits Will Be Taxed

How Social Security Work Credits Help You Get Disability Benefits

Most people know that you pay tax into the Social Security Trust Fund throughout your career, but did you know that you may also have to pay tax on your Social Security benefits once you start receiving them? Benefits lost their tax-free status in 1984, and the income thresholds for triggering tax on benefits haven’t been increased since then.

As a result, it doesn’t take a lot of income for your Social Security benefits to be pinched by Uncle Sam. For example, a married couple with a combined income of more than $32,000 may have to pay income tax on up to 50% of their Social Security benefits. Higher earners may have to pay income tax on up to 85% of their benefits.

You may also have to pay state income taxes on your Social Security benefits. See our list of the 13 States That Tax Social Security Benefits.

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Can You Get Social Security Disability If You Dont Have Enough Work Credits

Home » Frequently Asked Questions » Can You Get Social Security Disability If You Dont Have Enough Work Credits?

You cannot get Social Security Disability Insurance benefits on your own work record if you dont have enough work credits, but you might qualify for Supplemental Security Income payments. While the SSDI program requires applicants to meet a work credits requirement, the SSI program does not.

If your application is approved for SSI benefits, you could receive monthly cash payments, Medicaid, and back pay dating from the month you originally applied. Our firm assists clients who are seeking disability benefits in Rutherfordton and other communities in North Carolina. We take calls day or night, so you do not have to wait to reach out for help.

  • An overview of work credit requirements for SSDI
  • How you earn work credits
  • Why SSDI requires work credits
  • How to qualify for SSI benefits
  • How a lawyer with our firm can help you apply for disability benefits
  • Children Can Collect Social Security Benefits Too

    Minor children of Social Security beneficiaries can be eligible for benefits. Children up to age 18 and disabled children older than 18 may be able to receive up to half of a parent’s Social Security benefit. The disability must have occurred before the age of 22. As long as the disability prevents the person from working, the adult child can continue collecting the benefit even after the parent has died.

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    Are You Eligible For Social Security

    To be eligible for Social Security benefits, you must earn at least 40 credits over your working career. How those credits are calculated is complex, but you will likely qualify if you have worked for at least 10 years.

    You may be entitled to a spousal benefit because of your partner’s work history. If your spouse, ex-spouse, or deceased spouse has earned 40 credits, you may qualify. The Social Security Administration provides more info about this option.

    But your work history is not only used as part of the qualification criteria it is also used to figure out the amount of your payment. In calculating your monthly retirement benefit, the SSA considers your highest-earning 35 years of work history. If you worked for less than 35 years, the SSA will use zero for some years.

    The higher your earnings over those 35 years, the greater your contribution to the program through FICA taxes, and the higher your benefit will be.

    The same threshold applies to both your earnings and your benefits. This amount is $142,800 in 2021.

    Number Of Credits Needed For Disability Benefits

    The Netspend Social Security Deposit Dates

    To be eligible for disability benefits, you must meet a recent work test and a duration work test.

    The number of credits necessary to meet the recent work test depends on your age. The rules are as follows:

    • Before age 24 – You may qualify if you have 6 credits earned in the 3-year period ending when your disability starts.
    • Age 24 to 31 In general, you may qualify if you have credit for working half the time between age 21 and the time you become disabled. As a general example, if you become disabled at age 27, you would need 3 years of work out of the past 6 years .
    • Age 31 or older – In general, you must have at least 20 credits in the 10-year period immediately before you become disabled.

    The following table shows how many years of work credits you need to meet the duration of work test based on your age when your disability began. For the duration of work test, your work does not have to fall within a certain period. The table only provides an estimate of how many work credits you need. It does not cover all situations. If you are statutorily blind, you must only meet the duration of work test. When statutory blindness is involved, there is not a recent work test requirement.

    NOTE: This table is an estimate only and does not cover all situations

    If you become disabled…
    9.5 years

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