Thursday, May 19, 2022

How To File For Your Social Security

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How to file for your Social Security benefits during the Coronavirus

The SSA can not pay benefits for the month of a recipients death. That means if the person died in July, the check received in August must be returned. Find out how to return a check to the SSA.

If the payment is by direct deposit, notify the financial institution as soon as possible so it can return any payments received after death. For more about the requirement to return benefits for the month of a beneficiarys death, see the top of page 11 of this SSA publication.

Family members may be eligible for Social Security survivors benefits when a person getting benefits dies. Visit the SSA’s Survivors Benefits page to learn more.

Get Ssa Benefits While Living Overseas

U.S. citizens can travel to or live in most, but not all, foreign countries and still receive their Social Security benefits. You can find out if you can receive benefits overseas by using the Social Security Administrations payment verification tool. Once you access the tool, pick the country you’re visiting or living in from the drop-down menu options.

Why Do You Need One

A Social Security number is important because you need it to get a job, collect Social Security benefits and get some other government services. You should keep your Social Security card in a safe place with your other important papers and avoid giving it out unnecessarily. Keep in mind that in many cases, even if you lost your card, you may not need a replacement. In most cases, simply knowing your Social Security number is enough. But if you do need a replacement, we make it easy.

Note:

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If You Don’t Have All Of The Documents

Even if you don’t have everything, don’t delay applying for Social Security retirement benefits. You can provide the missing documents later. We may be able to help you get them.

In many cases, your local Social Security office can contact your state Bureau of Vital Statistics and verify your information online at no cost to you or find other ways to get the information we need.

If you delay signing up, you could lose some benefits you may be due.

There Are Social Security Benefits For Surviving Spouses And Children

Social Security Card Application Online

If your spouse dies before you, you can take a Social Security survivor benefit, but not in addition to your own benefit. You must choose one or the other. If you are at full retirement age, that benefit is worth 100% of what your spouse was receiving at the time of his or her death .

A widow or widower can start taking a survivor benefit at age 60, but the benefit will be reduced because it’s taken before full retirement age. If you remarry before age 60, you cannot get a survivor benefit. But if you remarry after age 60, you may be eligible to receive a survivor benefit based on your former spouse’s earnings record.

Eligible children who are under age 18 or were disabled before age 22 can also receive a Social Security survivor benefit, worth up to 75% of the deceased’s benefit.

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Theres A Social Security Spousal Benefit

Marriage brings couples an advantage when it comes to Social Security. Namely, one spouse can take what’s called a spousal benefit, worth up to 50% of the other spouse’s Social Security benefit. Put simply, if your monthly Social Security benefit is worth $2,000 but your spouse’s own benefit is only worth $500, your spouse can collect a spousal benefit worth $1,000 — bringing in $500 more in income per month. Just as the benefit based on your own work history is reduced if you claim it early, the same is true for a spousal benefit. That 50% figure is the maximum amount that only a spouse who is at least full retirement age is eligible for. Taking the spousal benefit early at, say, age 62, reduces the amount to as little as 32.5% of the higher earners benefit. If you take your own benefit early and then later switch to a spousal benefit, your spousal benefit will still be reduced.

Do You Get More Social Security At 63 Than 62

Monthly Social Security payments are reduced if you sign up at age 63, but by less than if you claim payments at age 62. A worker eligible for $1,000 monthly at age 66 would get $800 per month at age 63, a 20% pay cut. If your full retirement age is 67, you will get 25% less by signing up at age 63.

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The Impact Of Roth Iras

If youre concerned about your income tax burden in retirement, consider saving in a Roth IRA. With a Roth IRA, you save after-tax dollars. Because you pay taxes on the money before contributing it to your Roth IRA, you will not pay any taxes when you withdraw your contributions. You also do not have to withdraw the funds on any specific schedule after you retire. This differs from traditional IRAs and 401 plans, which require you to begin withdrawing money once you reach 72 years old, or 70.5 if you were born before July 1, 1949.

So, when you calculate your combined income for Social Security tax purposes, your withdrawals from a Roth IRA wont count as part of that income. That could make a Roth IRA a great way to increase your retirement income without increasing your taxes in retirement.

Another thing to note is that many retirement plans allow individuals, aged 50 years or older, to make annual catch-up contributions. For 2021, you can make catch-up contributions up to $1,000. These must be made by the due date of your tax return. You have until April 15, 2022 to make the $1,000 catch-up contribution apply to your 2021 Roth IRA contribution total.

Final Thoughts On Reporting Naturalization To Ssa

When to file for Social Security

Reporting naturalization to Social Security Administration is very important.

After naturalizing to become a U.S. citizen, you are not done with the citizenship process.

Sometimes, during the oath ceremony, you will be told to update your new status with Social Security but this is not guaranteed.

Its up to you to update SSA and let them know you are now a U.S. citizen.

Some new Americans wonder whether its necessary at all to update your status from permanent resident to a naturalized citizen.

Ill tell you that it benefits you more to do this.

Of course, there is no consequence if you completely forget and choose not to notify Social Security.

Some of the benefits you get are access to some disability and retirement benefits that are only available to U.S. citizens.

Some people decide to apply for a U.S. passport first which is perfectly fine.

Since updating your status only benefits you, its in your best interest to remember to do it at some point.

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Gather Your Exs Information

Youre going to need some information to prove to Social Security that youre eligible for your exs benefits. Be prepared to provide your marriage license and your divorce decree.

Social Security will also need to locate their record. This will be easiest if you still have their Social Security number. If you no longer have it, Social Security may be able to find their record if you can provide their date of birth, where they were born and the names of their parents.

How Your Social Security Benefits Are Calculated

Your Social Security benefits are based on the 35 calendar years in which you earned the most money. If you have fewer than 35 years of earnings, each year with no earnings will be factored in at zero. You can increase your Social Security benefit at any time by replacing a zero or low-income year with a higher-income year.

There is a maximum Social Security benefit amount you can receive, though it depends on the age you retire. For someone at full retirement age in 2021, the maximum monthly benefit is $3,113. For someone filing at age 70, the maximum monthly amount is $3,895.

You can estimate your own benefit by using Social Security’s online Retirement Estimator.

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Claiming Social Security Benefits At The Right Time Means More Money In Your Pocket Here’s A Guide To Everything From Knowing Your Full Retirement Age To Taking Social Security Spousal Benefits

For many Americans, Social Security benefits are the bedrock of retirement income. Maximizing that stream of income is critical to funding your retirement dreams.

The rules for claiming Social Security benefits can be complex, but this guide will help you wade through the details. By educating yourself about Social Security, you can ensure that you claim the maximum amount to which you are entitled.

Here are 12 essential details you need to know.

Is There A Maximum Benefit

Social Security

Yes, there is a limit to how much you can receive in Social Security benefits. The maximum Social Security benefit changes each year. For 2021, itâs $3,895/month for those who retire at age 70 . Multiply that by 12 to get $46,740 in maximum annual benefits. If that’s less than your anticipated annual expenses, youâll need to have additional income from your own savings to supplement it.

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How To Report Us Citizenship To Social Security

To report naturalization to Social Security, you must complete form SS-5. Once you complete the form, you can either mail it or visit a local Social Security Administration office in person to submit it.

I highly recommend going in person because the process is much faster.

If you do decide to go in person, be sure to bring the following:

  • Proof of U.S. citizenship
  • Another form of picture ID

You can get Form SS-5 at the SSA office and complete it at their office but it may be easier to just print it out before heading to their office.

Finally, you will be interviewed by the Social Security Administration office staff.

They will want to verify your citizenship and then update your records.

If you update social security after citizenship it will not result in a new social security card being issued to you unless there were restrictions on your old card that I mentioned before.

If you would like a new social security card, make a request for one during your interview with the office staff.

Case Example:

Amir has recently become a U.S. citizen by completing the oath ceremony after submitting his N-400 application almost a year ago. He then decides to apply for a U.S. passport so he can travel without worrying about re-entry issues.

Six months later, Amir decides to go the the Social Security Administration to notify them that he is now a U.S. citizen. He takes his passport as proof as well as his drivers license and the completed SS-5 form.

To Find Out If Their Benefits Are Taxable Taxpayers Should:

  • Take one half of the Social Security money they collected during the year and add it to their other income.

Other income includes pensions, wages, interest, dividends and capital gains.

  • If they are single and that total comes to more than $25,000, then part of their Social Security benefits may be taxable.
  • If they are married filing jointly, they should take half of their Social Security, plus half of their spouse’s Social Security, and add that to all their combined income. If that total is more than $32,000, then part of their Social Security may be taxable.

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Replacement Card For A Us Born Child

You can replace your child’s Social Security card for free if it is lost or stolen. You are limited to three replacement cards in a year and 10 during a lifetime. Legal name changes and other exceptions do not count toward these limits. For example, changes in immigration status that require card updates may not count toward these limits. Also, you may not be affected by these limits if you can prove you need the card to prevent a significant hardship.

Important

You must present original documents or copies certified by the agency that issued them. We cannot accept photocopies or notarized copies. All documents must be current . We cannot accept a receipt showing you applied for the document.

What Documents Do I Need To Prove My Identity

How do I File a Social Security Disability Application.

Social Security will ask to see your current U.S. immigration documents. Acceptable documents include:

  • I-551 Permanent Resident Card
  • I-94 Arrival/Departure Record with unexpired foreign passport, or admission stamp in the unexpired foreign passport or
  • I-766 Employment Authorization Document, from DHS.

Important

You must present original documents or copies certified by the agency that issued them. We cannot accept photocopies or notarized copies. All documents must be current . We cannot accept a receipt showing you applied for the document.

We may use one document for two purposes. For example, we may use your U.S. passport as proof of both citizenship and identity.

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Replacement Card For A Foreign Born Us Child

You can replace your child’s Social Security card for free if it is lost or stolen. However you may not need to get a replacement card, knowing your childâs Social Security number is what’s important. You are limited to three replacement cards in a year and 10 during a lifetime. Legal name changes do not count toward these limits. Also, you may not be affected by these limits if you can prove you need the card to prevent a significant hardship.

Important

You must present original documents or copies certified by the agency that issued them. We cannot accept photocopies or notarized copies. All documents must be current . We cannot accept a receipt showing you applied for the document.

Are Social Security Benefits Taxed After Age 66

Once you reach full retirement age, Social Security benefits will not be reduced no matter how much you earn. However, Social Security benefits are taxable. If your combined income is more than $44,000, as much as 85% of your benefits may be subject to income taxes.

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Understanding Social Security Taxes

If you work for someone else, Social Security taxes are deducted from your paycheck. The Social Security tax rate for 2021 is 6.2%, plus 1.45% for the Medicare tax. So, if your annual salary is $50,000, the amount that will go to Social Security over the course of the year is $3,100, plus $725, for a total of $3,825.

Your employer will match an additional $3,825 over the course of the year, and it will also report your Social Security wages to the government. When you retire or if you become disabled, the government uses your history of Social Security wages and tax credits to calculate the benefit payments youll receive.

What Happens When Youre Self

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When you’re self-employed, youre considered both the employee and the employer. This means its your responsibility to withhold Social Security from your earnings, contributing the employers matching portion of Social Security and the individuals portion. Instead of withholding Social Security taxes from each paycheckmany self-employed people dont get regular paychecks, after allyou pay all the Social Security taxes on your earnings when you file your annual federal income tax return. This amounts to both your personal contribution and your businesss contribution.

IRS Schedule SE: Self-Employment Tax is where you report your businesss net profit or loss as calculated on Schedule C. The federal government uses this information to calculate the Social Security benefits youll be entitled to later on down the road. Self-employment tax consists of both the employee and employer portion of Social Security and the employee and employer portion of Medicare , which makes the total self-employment tax rate 15.3%.

It may seem like youre getting the short end of the stick because you have to pay both the employee and the employer portion of the tax, but that isn’t necessarily true.

If you are self-employed and earned $400 or less, you wont owe Social Security taxes.

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Calculating Your Social Security Income Tax

If your Social Security income is taxable, the amount you pay in tax will depend on your total combined retirement income. However, you will never pay taxes on more than 85% of your Social Security income. If you file as an individual with a total income thats less than $25,000, you wont have to pay taxes on your social security benefits in 2021, according to the Social Security Administration.

For the 2021 tax year, single filers with a combined income of $25,000 to $34,000 must pay income taxes on up to 50% of their Social Security benefits. If your combined income was more than $34,000, you will pay taxes on up to 85% of your Social Security benefits.

For married couples filing jointly, you will pay taxes on up to 50% of your Social Security income if you have a combined income of $32,000 to $44,000. If you have a combined income of more than $44,000, you can expect to pay taxes on up to 85% of your Social Security benefits.

If 50% of your benefits are subject to tax, the exact amount you include in your taxable income will be the lesser of either a) half of your annual Social Security benefits or b) half of the difference between your combined income and the IRS base amount.

The example above is for someone who is paying taxes on 50% of his or her Social Security benefits. Things get more complicated if youre paying taxes on 85% of your benefits. However, the IRS helps tax payers by offering software and a worksheet to calculate Social Security tax liability.

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