How To Find And Read Your Social Security Statement
If Social Security benefits figure into your retirement income plan, then reading your Social Security Statement is a must. This statement can help you estimate how much youll receive from Social Security once you retire. That can be useful when setting investing and savings goals. Knowing how to find your statement and decode it is a must for retirement planning.
State Taxes On Social Security
There are 13 states which tax Social Security benefits in some cases. If you live in one of those statesColorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, North Dakota, Rhode Island, Utah, Vermont, and West Virginiacheck with the state tax agency. As with the federal tax, how these agencies tax Social Security varies by income and other criteria.
Social Security Statement: How To Get The Statement Online
All you need to know
Social Security benefits provide a partial replacement of income for those who are retired or disabled. Employers generally send a wage and tax statement on behalf of their employees tot he Social Security Administration.
While most people decide to wait until theyve hit 70 to claim their benefits in order to maximise payments, it is possible to do so earlier, or to get a Social Security Statement in advance,
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What Is A Social Security Statement
Your Social Security Statement is issued by the Social Security Administration. It tells you about how much you or your family would receive in disability, survivor or retirement benefits. You can also see your record of lifetime earnings.
This statement is meant to be used a tool for retirement planning.It isnt typically a hard estimate of how much money you will get from Social Security once you retire. The Social Security Administration uses your earnings record as a baseline for forecasting future income. That number is then used to estimate Social Security benefits.
Because you havent earned that future income, your estimate benefit isnt set in stone. If you your earnings change late in life, your Social Security Statement could change as well.
What Is The Ffcra And/or Efmla Reported In Box 14
Under the Families First Coronavirus Response Act , employers are required to provide paid leave for specified reasons related to the Coronavirus Disease 2019 through two separate provisions: the Emergency Paid Sick Leave Act and the Emergency Family and Medical Leave Expansion Act . The FFCRAs paid leave provisions are effective April 1, 2020, and apply to leave taken between April 1, 2020, and December 31, 2020. The Internal Revenue Service issued guidance IRS Notice 2020-54 to employers on the required reporting of qualified sick leave and family leave wages paid under the FFCRA. The guidance requires employers to report separately the amount of emergency sick and family leave paid to employees under FFCRA on either 2020 Forms W-2, Box 14, or on a separate statement. This required reporting provides employees who are also self-employed with amounts they may need to figure their qualified sick leave equivalent or equivalent family leave equivalent credits under FFCRA when they file their taxes.
INFORMATION FOR FFCRA AND/OR EFMLA REPORTED IN BOX 14
Included in Box 14, if applicable, are amounts paid as qualified sick leave wages or qualified family leave wages under the Families First Coronavirus Response Act. Specifically, up to two types of paid qualified sick leave wages or qualified family leave wages are reported in Box 14:
- Sick leave wages subject to $511 per day limit because of care you required and
- Emergency family leave wages.
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How Do I Get My Social Security Earnings Statement Online
You can view your personal Social Security Statement online by creating a my Social Security account with us. Your online Social Security Statement displays uncertified yearly earnings free of charge and does not show any employer information. To sign in or create an account, go to www.socialsecurity.gov/myaccount.
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The Back Payment Issue
If you have just begun receiving Social Security Disability payments and you received a back payment from the SSA, you need to be very careful when filing taxes and claiming your back payment amount as income on your tax return. Back payments are usually paid as a lump-sum amount by the SSA. This does not mean, however, that you should claim the full amount on the tax return for a single year. If you do claim your back pay as a single years income, it will put you in a higher tax bracket and you may end up paying more taxes than you are actually liable for. Instead, you should file amended returns for the years that the back payment covered and only claim this years payment on your current years income tax return.
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 youre visiting or living in from the drop-down menu options.
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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:
- Direct Express debit card – a pre-paid debit card. Get help by calling the Go Direct Helpline at .
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.
How To Stop Social Security Check Payments
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.
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Social Security Statements Just Got Easier: How Can I Get A Copy For Retirement Planning
The Social Security Statement just got a revamp, and your information is now easier to find than ever.
To clarify, this is not the statement you receive once you have already started receiving Social Security benefits. Your Social Security Statement is available to any adult worker who does not receive benefits. This type of statement is unique to your working history and gives estimates of future Social Security benefits that you might receive each month. You will also be able to access your earnings history.
The Social Security Administration states that it is crucial to review this record for errors so that if or when you spot one, you can have it corrected. This will ensure that you receive all of the benefits owed to you. For example, the SSA could have on their records, at least that you earned $55,000 this year and last, but in actuality your earnings were closer to $65,000. This will result in a lower benefit to you, even though you might have already paid the taxes based on a larger earnings base and such an error requires correction. Your online statement will show you how to make such a correction.
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Request For A Social Security Statement
If you dont want to wait for your Social Security Statement to be mailed to you, you may sign up to get your Social Security Statement online. You also may be able to estimate your retirement benefit using our online Retirement Estimator.
If you would like to receive your Social Security Statement by mail, please print and complete a “Request For Social Security Statement” and mail it to the address provided on the form.
You should receive your paper Social Security Statement in the mail in four to six weeks.
If you were unable to create or encountered a problem with your mySocial Security account, you may visit a local office or call 1-800-772-1213 for help.
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Big Improvements In The New Social Security Statements
I see a few big improvements in the new Social Security Statement:
The nifty, simple, colorful bar chart called Personalized Monthly Retirement Benefit Estimates . In the Statement’s previous incarnation, you might have been led to believe that it was smart to begin claiming Social Security as early as allowed at 62 or at Full Retirement Age . But the new chart shows the advantage of delaying claiming if you can.
Social Security’s rules essentially give you an 8% bigger benefit for each year you postpone claiming benefits after your Full Retirement Age, until age 70. Put another way, if you’re now 66 and wait until 70 to start claiming, you’ll see 32% larger benefits than if you filed at your Full Retirement Age. But 62 is one of the most popular ages for people to begin claiming Social Security.
The new Social Statement puts the value of delayed claiming into sharp focus through its bar charts. As an example, someone born in 1960 who’d continue to earn about $50,000 a year until starting benefits might see that claiming at 62 would provide a $1,050 monthly benefit but waiting to 70 would deliver $1,860 a month.
“People should be aware that if they retire early, that means an actuarial deduction the amount they’re going to receive and that continues on to the rest of their retirement,” said Kijakazi. “Having that visual makes it clear instinctively for people what their choices are as they make their decisions.”
Make Payments To The Federal Government
Learn how to use Pay.gov to make secure, electronic payments to government agencies from your checking or savings account. You can use the online service for VA medical care copayments, U.S. district court tickets, U.S. Coast Guard merchant mariner user fee payments, and more.
If you need help, contact Pay.gov customer service.
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What Is A Social Security Benefit Verification Letter
The Benefit Verification letter, sometimes called a “budget letter,” a “benefits letter,” a “proof of income letter,” or a “proof of award letter,” serves as proof of your retirement, disability, Supplemental Security Income , or Medicare benefits. You may use your letter for loans, housing assistance, mortgage, and for other income verification purposes. You can also use it to prove that you don’t receive benefits, have applied for benefits, or that you have never received Social Security benefits or SSI.
In addition to name, date of birth, and the benefits received, the Benefit Verification letter includes other identifiers to prevent misuse and fraud.
Errors On Your Social Security Statement
Its important to review your earnings record carefully to make sure youre getting appropriate credit for the money youve earned from working or self-employment. Its your earnings that determine the number of credits you receive and your benefit amount. If those earnings arent being reported correctly by you or your employer, then that could shrink the benefits you receive once you retire.
If you see an error on your record, you can call the Social Security Administration at 1-800-722-1213 to have it corrected. Youll need to have your W-2 or tax returns for any years youre disputing ready to verify your income.
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If You Only Qualify For A Teachers Retirement System Pension
If you have never paid Social Security tax and only qualify for your teachers retirement, its likely youll never receive a Social Security benefit.
Although this makes perfect sense to some, others think its still pretty unfair that this isnt true for everyone. For example, if you had chosen to stay at home as the household manager, you would not have paid into the Social Security system. However, you would be eligible for spousal and survivor benefits.
These intricate Social Security regulations and how differently they may affect a workers retirement income make it critical that you plan ahead and prepare. Before you make your elections on your teachers pension, you must consider how your monthly cash flow would change with a spouses death.
As a teacher, you have plenty to keep up with and these complex rules on Social Security dont make it any easier. Thats why its important to have a quick and easy source of information at your disposal so can make the best decisions for you and your family.
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Social Security Begins Issuing Annual Statements To 125 Million Workers
Beginning October 1, the Social Security Administration will launch the largest customized mailing ever undertaken by a Federal agency when it sends an annual Social Security Statement to 125 million workers. The 4-page statement is designed to help workers with financial planning by providing estimates of their retirement, disability and survivors’ benefits. The statement will also provide workers an easy way to determine whether their earnings are accurately posted on their Social Security records. This is an important feature because Social Security benefits are based on an individual’s career wage record.
“The Social Security Statement is a valuable tool that will help Americans prepare for their long-term financial security,” Social Security Commissioner Kenneth S. Apfel said. “It puts the future in their hands.”
The annual Social Security Statement is the result of efforts by Senator Daniel Patrick Moynihan to establish in law the requirement that all Americans receive an annual statement of potential Social Security benefits. By law, SSA will send the annual statements to workers who are ages 25 and older and not receiving Social Security benefits. SSA will stagger the mailing of the statements throughout the year, with approximately 500,000 statements delivered each day. Workers will automatically receive their statements about three months before their birth month.
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Understanding Your Social Security Statement
The first step to reviewing your prospective Social Security benefits is to log on to the SSA and create a my Social Security account. This is your go to resource to review your future benefits as you continue to work and it allows you to check how your benefits are changing as your earnings history evolves over your ongoing career. If you havent created a my Social Security account and you reach age 60, the SSA will mail Social Security Statements to you three months prior to your birthday each year.
Your Social Security Statement is full of useful information about your benefits and potentially the benefits available to your family depending on your personal circumstances. At the top of the first page, the statement details your expected monthly retirement benefit at your Social Security Full Retirement Age. Page two delves further into the details related to your estimated benefits especially those related to retirement that well focus on for the remainder of the article. The SSAs fictional worker, Wanda Worker, will help us to dissect those benefits.
Wanda has enough Social Security to qualify for a retirement benefit. Her earnings history projects expected Social Security retirement benefits as detailed below:
It is crucial to verify that the earnings record shown on your Social Security statement is correct, since this ties directly into the calculation of your retirement benefits.
What You Can Do
As with many business problems, the best way to deal with a missing 1099 or lost W-2 is to not lose them to begin with. Of course, not much can be done to keep document issuers from making mistakes such as attempting to send a tax form to the wrong address. And, given human forgetfulness and the volume of documents required to operate a business, its likely that some lost paperwork will always be a feature of tax time.
However, there is much you can do to reduce the frequency and seriousness of the consequences of misplacing key forms. Scanning and digitizing paper receipts, backing up files and using cloud-based storage and remote servers can all help keep occasionally forgetful business owners from experiencing more than brief inconvenience from lost paperwork.
Even if flood or other disaster wipes out all a businesss records, these data safety practices can keep April from being any crueler than necessary. With that in mind, Hockenberry advises, Business owners should seriously consider off-site storage of important documents.
A version of this article was originally published on March 13, 2014.
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