Wednesday, August 10, 2022

How To Verify Social Security Income

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Max Out Earnings Through Full Retirement Age

VERIFY: Did Congress take money from Social Security?

The SSA calculates your benefit amount based on your earnings, so the more you earn, the higher your benefit amount will be. Some pre-retirees look for ways to increase their income, such as taking on part-time work or generating business income. Others, however, unaware of the impact on benefits, may scale back on their work or semi-retire, which can lower their Social Security income.

“Money earned after age 60 isn’t indexed, which means that income-earning in your 60s can replace a year in which there was a zero or a year in which you had lower earnings,” says Marguerita Cheng, CFP®, CRPC®, RICP, CDFA, CEO of Blue Ocean Global Wealth, Gaithersburg, MD.

Earnings above the annual cap$142,800 in 2021 and indexed to inflation each yearare left out of the calculation. Your goal should be to maximize your peak earning years, striving to earn at or above the cap.

For Individuals Who Receive Both Ssi And Ssp Benefits:

If you receive both SSI and SSP benefits, you will report your changes to SSA.

Examples of changes that must be reported include, but are not limited to:

  • Change of residence and/or mailing address
  • Change in countable resources that exceed $2000 for an individual or $3000 for an SSI/SSP couple
  • Changes in bank account information
  • Changes in your payee
  • Changes in who you wish to allow to receive information about your benefits

NOTE: You must report any change in your State Living Arrangement directly to NYS SSP, not to the SSA.

A change in living arrangement must be reported to NYS SSP within ten days of the date of the change. Please note that a change in who is in the household must be reported even if your address has not changed. The death of a household member, or changes to who is living in the household are living arrangement changes that must be reported.

Verify Proof Of Social Security Income By Phone

If your applicant does not have online access, they can call 1-800-772-1213 where they can request a letter in the mail.

I called the number to see what would happen. The automation instructs you to say what youre calling about and go through a bunch of prompts from there.

Here are the prompts to which I gave voice responses up to the point of entering my Social Security number.

  • Benefit Verification Letter
  • Yes
  • I was then prompted to enter my Social Security number one digit at a time

    At this point, I dropped off the call because I do not currently have any Social Security income.

    From what I gather, the tenant applicant would need to answer another income verification question before being patched through to get a benefit verification letter.

    Once they have this verification letter, they can share it with the landlord.

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    Avoid Social Security Tax

    If you are planning on supplementing your retirement income by working after you start receiving Social Security benefits, you need to be aware of the tax consequences of increasing your income. Anywhere from 50% to 85% of your benefit payment can be subject to federal taxes.

    To determine how much of your benefits will be taxed, the IRS will add your nontaxable interest and half of your Social Security income to your adjusted gross income . If that total amounts to $25,000 to $34,000 for single filersor $32,000 to $44,000 for joint filersup to 50% of your Social Security income is subject to tax. When that amount exceeds $34,000 for a single filer or $44,000 for joint filers, up to 85% of your benefits are subject to taxes.

    You may be able to avoid paying taxes on Social Security income by considering ways to spread out your income from various sources so as to prevent any increases that could trigger a higher tax.

    “Many investors have a ‘tax honeymoon’ period between retirement and age 72. They have no earned income and are not required to withdraw from their IRAs yet. If they have a nonqualified account, they can withdraw tax-free principal. In this situation, it is quite possible that Social Security benefits will be tax-free,” says James B. Twining, CFP®, wealth manager, Financial Plan, Inc., Bellingham, WA.

    What Would Happen If I Did Not Report My Earnings To The Ssa

    Social Security And Supplementary Security Income Verification Form ...

    You are fully responsible for reporting any changes or updates to your income and earnings.

    Your income level directly affects your benefits. If you are reporting your income incorrectly or neglect to update the SSA once your income is above the maximum limit you will lose your benefits.

    If you fail to report a change or overpayment your social security benefits may be permanently affected. The Social Security Administration could reduce your payments, apply a charge to your next payment, or completely stop all payments.

    If you do not report an overpayment you may have additional fees or charges the SSA request later.

    If you purposely report false income or other incorrect information your payments may be sanctioned by the SSA. This means you will receive financial penalties which could include a fine and your payments being cut off.

    When you receive the first sanction from the SSA against your benefits the SSA will stop your payments for six months. If you receive a second sanction, your payments will stop for 12 months. A third sanction will halt your benefits for 24 months.

    Reporting false information when applying for Social Security benefits could also be considered committing Social Security fraud. This could permanently affect your ability to receive any benefits.

    I hope you have found this article helpful. Follow the steps to check your earning record and confirm everything is in order.

    David Duford

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    How To Correct An Error On Your Social Security Statement

    If you have evidence of your covered earnings in the year or years for which you think Social Security has made an error, call Social Security’s helpline at 800-772-1213, Monday through Friday, from 7 a.m. to 7 p.m. This is the line that takes all kinds of Social Security questions, and it is often swamped, so be patient. It is best to call early in the morning or late in the afternoon, late in the week, or late in the month. Have all your documents handy when you speak with a representative.

    If you would rather speak with someone in person, call your local Social Security office and make an appointment to see someone there, or drop into the office during regular business hours. If you drop in, be prepared to wait, perhaps as long as an hour or two, before you get to see a representative. Bring with you two copies of your benefits statement and the evidence that supports your claim of higher income. That way, you can leave one copy with the Social Security worker. Write down the name of the person with whom you speak so that you can reach the same person when you follow up.

    The process to correct errors is slow. It may take several months to have the changes made in your record. After Social Security confirms that it has corrected your record, request another benefits statement to make sure the correct information made it to your file.

    What Is An Income Verification Form

    How do you actually go about verifying the income of a potential tenant?

    In most cases, youll want to use a type of income verification form. Income verification letters dont always follow a standard outline, but they act as a form of proof of what the tenant is earning monthly or annually. These letters can come from an employer, court, bank, or the Social Security Administration, depending on what type of income the tenant has.

    For example, a tenant who receives a court-mandated payout each month may have a verification letter from the court to show you. Additionally, some tenants may use tax forms, pay stubs, or bank statements as their verification.

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    What Is Proof Of Income

    Landlords use a document known as proof of income, which allows them to confirm the average earnings of a prospective tenant. Landlords use this information to make sure the tenant can cover the monthly rent, and it is a great way to screen tenants to ensure they arent renting to an unprepared tenant.

    In some cases, you may want to request more than one type of verification. For example, prospective tenants who receive weekly payments but can only provide a few stubs should also be asked to provide an employer verification letter. This letter will show you that the tenant is employed long-term and that these payments will continue for the foreseeable future.

    Some types of income proof might be out of the realm of what you are used to seeing, but that doesnt make those types of income less worthy. For example, freelancers may need to provide 1099s and bank statements rather than an employer verification letter because they work with a variety of clients.

    Review each document carefully, and be sure to follow all local rules when determining tenant eligibility based on income.

    What Is Ssn Validator

    How To: Get a Benefit Verification Letter

    SSN Validator is an online tool that validates SSN numbers and determine when and where a social security number was issued using our extensive database.

    It validate SSN number which is divided into three parts by hyphen . The first set of three digits is called the Area Number, which is between 900 and 999, and it should not be 000 or 666. The second set of two digits is called the Group Number, which is between 01 to 99. The final set of four digits is the Serial Number which is between 0001 to 9999.

    All SSN number data was collected from the Social Security Administration’s Highest Issued Group data, and It was updated until the Social Security Randomization policy took effect in June 2011.

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    What If My Earning Records Are Incorrect

    If you receive your earning records and find some discrepancies you will need to correct them. Notify the SSA of the missing or incorrect information.

    You may need to provide more documents to prove the information is incorrect.

    If the last year or two is missing from your earning records it may not be as big of a deal. The SSA may not have recorded the earnings yet. You can call the SSA and check the status of your earning records for the last year or two.

    If earning records are not showing up for another reason you need to contact the SSA and send in your W-2 forms, tax returns, and/or paystub or payslip. Provide those documents for any years where your earning record is not correct.

    You can also provide your own wage record or other documents showing you were working and receiving income.

    If you have no documentation you will need to try to remember any details of your work history. Write down when you worked, where you worked, your employer or clients name. Include how much you earned and the SSN and name you used when you worked.

    Once you have all that information you can call the SSA or go into an office near you. An agent will work with you to correct your earning records.

    If you choose to visit a local Social Security office, find a location close to you by searching your zip code in this locator. Make sure to call ahead of time to set up an appointment.

    Be prepared to answer detailed questions about your income and work history.

    Your Personal Nest Egg

    The best option when it comes to supplementing Social Security income is to have your own retirement nest egg. If you worked for a larger company in your life, you likely had access to a 401, 403 or 457 plan. If you worked on your own, you may have contributed to an IRA, or perhaps even a solo 401 plan. Whatever the case, with diligent saving you can usually build up a nest egg over time that exceeds the amount you’ll draw from Social Security. If you’re still far away from retirement, use this time to maximize your contributions to these types of tax-advantaged plans so you don’t have to rely on Social Security.

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    Use Your Social Security Checks To Cover Healthcare Expenses

    After budgeting to cover your basic needs, you should next pay for your medical expenses. Let’s assume that you’ll spend close to the national healthcare cost average for Americans 65 and older, which the BLS estimates at $6,833 per year. If you spend close to this amount, it’s wise to dedicate the remainder of your check toward this expense. But it’s also important to plan for rising healthcare costs that your Social Security checks likely won’t cover.

    The 2021 Retirement Health Care Costs Report by HealthView Insights recently reported that a healthy, national average couple, 65 or older, paid an average of $662,156 on retirement health care in 2020. Most 65-year-old couples in 2021 can spent between $156,208 and 1,022,997 on heath care depending on the state they retired in and the type of health care they needed.

    What Money And/or Assets Can Count As Earnings can

    The following items are considered earning and should be noted on any earning records:

    • Wages paid from an employer
    • Cash payments for work you have completed
    • In-Kind income which is any items, supplies, housing, or other things your get for free or at a reduced price
    • Deemed income which is income from those you live with or a spouse
    • Payment for an item you have sold
    • Profit earned when you work for yourself
    • Profit earned from an investment
    • Rental income
    • A mutual fund or ETF earnings
    • Income or dividends earned when you reinvest earnings
    • Any other assets that generate a profit
    • Unearned Income: Payments from the SSA for any benefits or assistance

    Make sure to count any costs you cover when working. Especially if you work for yourself include any rental payments, utilities, tools, subscriptions, or payments to other professionals. Those deductions can go a long way.

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    Checking Your Social Security Earnings Record

    How confident are you that your Social Security earnings record is accurate?

    Unless youve checked it recently, you shouldnt be too sure.

    Mistakes in an individuals Social Security earnings record are actually much more common than most people think. In tax year 2012 alone, the Social Security Administration reported $71 billion in wages that could not be matched to an individuals earnings record! The good news is that the Social Security Administration has a system for sorting out some of these mistakes and assigning the earnings to the correct record. But nearly half of the mismatches are never corrected. That means that in 2012 there were approximately $35 billion in wages that was never credited to an individuals Social Security history.

    Prioritize Your Basic Needs

    Next, it’s time to allocate your Social Security benefits. Leonard Hayduchok, CEO and president of Dedicated Financial Services, suggests treating your Social Security check as you would a paycheck. Use the benefits to pay for regularly occurring expenses such as housing costs and groceries. According to the BLS survey, people 65 and older spend an average of the following amounts on food and related housing expenses a year:

    • Housing: $17,472

    • Utilities: $3,810

    • Food: $6,599

    You should try to allocate about 60% to 70% of your annual Social Security benefits to pay for these expenses, though that won’t be possible for many retirees. If your annual benefits equal the national average of $1,619.67 a month or $19,436.04 a year, that means 60% of your Social Security check — which comes out to $11,633.83 annually — won’t be enough to cover the expenses above.

    Still, it’s a good idea to dedicate as much as you can to food and housing. After all, these are your basic needs — without them, you won’t live well. Just keep in mind that once you’ve used your check to cover these basic expenses, you’ll likely need to dip into your additional income sources to cover other costs.

    Retirees whose food and housing costs are greater than their Social Security checks should look for ways to cut back on these expenses. For example, one option might be to move to a city where you can live comfortably off Social Security.

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    Why Proof Of Income For Apartment Applicants Matters

    Tenant screening is a process that includes many steps, and one of the most important is to verify the tenants reported income. New landlords who dont have a lot of experience choosing tenants may not fully grasp the importance of this step, but why does it matter so much?

    Tenants who dont make enough monthly income to comfortably cover the rent on top of their other expenses are more likely to pay late or miss rent payments than other applicants. If a tenant cannot easily make rent each month, they may fall behind, which could even lead to an eviction situation.

    Verifying income is just another part of the process of choosing the best tenant for your property. Alongside credit checks, references, and rental history, having all of this information will make it easier to make the right decisions.

    Screening tenants thoroughly, which includes verifying two or three income sources, is time-consuming, but the time investment will pay off. You want to be sure the tenant is not lying or trying to hide anything about their finances, as this is a big red flag. Take time to do this right, and youll have less to worry about long-term.

    How To Get Your Social Security Statement

    You should regularly check the estimated Social Security benefit youll eventually get

    The Social Security Administration used to send statements out to all taxpayers on an annual basis. But several years ago they ended that practice, in an effort to save money. However, you can still obtain a copy of your statement online. You can create a mySocial Security account on the SSA website.

    When you go to the mySocial Security page, set up a username and password. You can use this to access your account at any time. Once youve created your account, youll have regular access to your Social Security statement.

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