Monday, May 16, 2022

Who Benefits From Social Security

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Can I Retire At 55 And Collect Social Security

Who Is Eligible for Social Security Disability Benefits

So can you retire at 55 and collect Social Security? The answer, unfortunately, is no. The earliest age to begin drawing Social Security retirement benefits is 62. Once you turn 62, you could claim Social Security retirement benefits but your earnings from consulting work could affect how much you collect.

Discuss Your Retirement Goals

Maybe you want to buy a modest lake house and spend your senior years enjoying the view. Or maybe your goal is to move to a big city and indulge in fine dining and nightlife.

No matter how you envision your retirement, it’s important for you and your spouse to discuss those goals before filing for Social Security. You may decide, together, that delaying at least one set of benefits makes sense based on the amount of income you’ll need to spend your days the way you want to.

When you’re single and approaching retirement age, you only have to consider your own needs when claiming Social Security. But when you’re married, filing for benefits is really a decision that shouldn’t be made independently. Before you sign up for Social Security, spend some time hashing things out with your spouse so you can get on the same page and come up with a strategy that will make your dream retirement a reality.

Paying Taxes On Your Retirement Benefits

Social Security retirement benefit recipients must pay Federal income taxes on their benefits. Due to personal income levels, about one-third of recipients actually have to pay some amount annually.

Each year, the Social Security Administration will mail recipients a Form SSA-1099 that shows the amount of benefits received during the preceding year. This form should be used to complete tax returns and help determine in any taxes are owed.

As a general rule, if you file as an individual and your combined income is between $25,000 and $34,000, you may have to pay taxes on up to 50 percent of your Social Security benefits. If your combined income is more than $34,000 you may be required to pay taxes on up to 85 percent of your benefits.

If you file a joint return and you and your spouses income is between $32,000 and $44,000, then 50 percent of your benefits may be taxed. If your combined income is about $44,000, then up to 85 percent of your benefits may be subject to income tax.

To assist with tax planning, Social Security can withhold Federal taxes throughout the year for benefit recipients which may be preferable to making quarterly estimated tax payments.

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Social Securitys Online Services

Theres probably been a time in your life when youve wondered, Can I do this online instead of visiting a Social Security office? The answer is more than likely yes, and you can find more information about our online services on our website. Online, you can apply for retirement and disability benefits, appeal a decision, and do much more.

Social Security Spousal Benefits Explained

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  • Social Security spousal benefits can pay an eligible spouse 50% of the partners benefit if it is higher than his or her own benefit. Claims can begin at age 62 but may be worth more at full retirement age. Read our Social Security review to learn more.

Social security is complicated for individual filers, and being married can make it even more complicated. Thats because Social Security includes benefits for the spouse as well as the individual.

When an individual files for retirement benefits, that persons spouse may be eligible for a benefit based on the worker’s earnings according to the Social Security Administration.

In this Social Security review, we outline the rules for spousal benefits.

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How Income Is Counted

If you work for someone else, only your wages count towards Social Securitys earnings limits. If you are self-employed, only your net earnings from self-employment are counted.

For earnings limit, the SSA does not count income such as other government benefits, investment earnings, pensions, annuities and capital gains.

An employees contribution to a pension or retirement plan is counted, but only if the contribution amount is included in the employees gross wages.

Social Security Increase: Will It Speed Up Benefit Depletion?

In general, if you work for wages, income will be counted when it is earned, not when it is paid. If you have earned income in one year, but the payment was made the following year, its important to note that it should not be counted as earnings for the year you receive it.

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Can You Still Work While Receiving Social Security

You can continue to work while you receive Social Security benefits. But there is a limit to how much you can earn and still receive full benefits. The earning limit may be adjusted each year.

If you earn above the limit, Social Security will deduct a certain amount of your benefits each year.

Social Security Benefits, Earning Limits and Penalties

SSA deducts $1 from your benefits for every $3 you earn above the limit

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What Are Social Security Benefits

Social Security benefits are payments made to qualified retirees and disabled people, and to their spouses, children, and survivors. Social Securityofficially the Old-Age, Survivors, and Disability Insurance program in the a comprehensive federal benefits program designed to provide partial replacement income for retirees and their spouses, those whose spouse or qualifying ex-spouse has died, and the disabled. Under specified conditions, it also supports the children of beneficiaries.

President Franklin Roosevelt signed the original Social Security Act into law in 1935. The current law, after a number of amendments, encompasses several social insurance and social welfare programs, including the issuance of Social Security benefits. Benefits are determined by a specific set of criteria issued by the Social Security Administration .

Benefits Available To Children & Parents

Social security benefits to jump nearly 6% in 2022 due to pandemic, local expert says

Eligible spouses arent the only ones that can receive Social Security survivor benefits. Dependent children and parents may also be entitled.

If you want to learn more, here are the best resources on the topic:

Childrens Benefits:

Social Security Benefits for Dependent Parents -Article by Mike Piper, the author of Social Security Made Simple.

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Demographic And Revenue Projections

This section’s factual accuracy may be compromised due to out-of-date information. The reason given is: Several of these projected dates have passed, and some language referring to data as ‘current’, ‘latest’, ‘most recent’, etc. is as old as 2005, or undated. Please help update this article to reflect recent events or newly available information.

In 2005, this exhaustion of the OASDI Trust Fund was projected to occur in 2041 by the Social Security Administration or by 2052 by the Congressional Budget Office, CBO. Thereafter, however, the projection for the exhaustion date of this event was moved up slightly after the recession worsened the U.S. economy’s financial picture. The 2011 OASDI Trustees Report stated:

Annual cost exceeded non-interest income in 2010 and is projected to continue to be larger throughout the remainder of the 75-year valuation period. Nevertheless, from 2010 through 2022, total trust fund income, including interest income, is more than is necessary to cover costs, so trust fund assets will continue to grow during that time. Beginning in 2023, trust fund assets will diminish until they become exhausted in 2036. Non-interest income is projected to be sufficient to support expenditures at a level of 77 percent of scheduled benefits after trust fund exhaustion in 2036, and then to decline to 74 percent of scheduled benefits in 2085.

Ways to eliminate the projected shortfall

Disability And Survivor Benefits

In addition to retirement benefit eligibility, the statement also provides estimates as to what your monthly income would be if you claimed disability benefits.

There are also estimates for how much monthly income through survivor benefits your eligible spouse or minor children may receive if you pass away.

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Social Security Administration Plans Benefit Changes For 2022

In 2021, Americans experienced the highest spike in inflation in three decades, as measured by the Consumer Price Index. According to the U.S. Bureau of Labor Statistics, the all-items inflation index rose 6.8% for the 12 months ending in November 2021, demonstrating the largest 12-month increase since the period ending in June 1982.

Noting these drastic inflation changes and in preparation for what 2022 would bring, the Social Security Administration issued a cost-of-living adjustment in October that will impact more than 70 million Americans. Social Security and Supplemental Security Income benefits will increase by 5.9% beginning in January 2022, with benefits payable to more than 64 million Social Security beneficiaries. Additionally, approximately 8 million SSI beneficiaries will see increased payments beginning on Dec. 30, 2021, to accommodate the sharp inflation increase.

Additional changes include an increased limit on taxed wages in 2022, an increased earnings limit for workers who are younger than âfullâ retirement age, as well as the first extension to full retirement age since changes were last enacted in 1983.

Courtesy Greenleaf Trust

Lisa Hojnacki, participant services coordinator/team lead for Greenleaf Trustâs retirement plan services division, said the monthly increase for SSI benefits are due to near-term inflation as a result of the pandemic.

Additional information is available at

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Social Security Disability Programs

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In addition to retirement benefits, the Social Security Administration manages two programs that provide benefits to people who are disabled or blind.

Social Security Disability Insurance Program
SSDI supports disabled or blind individuals by providing benefits based on their workers contributions to the Social Security trust fund. Your contributions are based on your earnings or your spouses or parents earnings while in the workforce. Your dependents may also be eligible for SSDI benefits based on your earnings.
Supplemental Security Income Program
SSI benefits are paid out as cash assistance to people with limited incomes and resources who are elderly, blind or disabled. These benefits may also include blind or disabled children. SSI payments are a federal benefit funded by the general fund of the United States not the Social Security trust fund. Some states provide additional state supplemental benefits in addition to the federal SSI payments.

In some cases, people may be eligible for both SSI and SSDI at the same time. The Social Security Administration calls these concurrent benefits. This can happen when a disability qualifies you for Social Security Disability Benefits, but you only get a small amount of monthly SSDI benefits. This may qualify you to receive SSI benefits as well.

Comparing SSDI and SSI Programs

Up to 85%

Income Taxes for Other Benefit Programs

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At What Age Do Social Security Benefits Start

Social Security benefits are paid out according to your retirement age. The full retirement age is 66 years old for those born between 1943 and 1954. If you were born after 1955, you have a full retirement age of 67. Those who choose to retire at that age receive the full retirement benefit amount. However, payments can begin as early as age 62 but are subject to a reduction in the total amount. Social Security benefits can also be delayed and continue accruing past the full retirement age up to 70 years old. However, you dont gain further credit for delaying your retirement benefits after 67.

Getting A Social Security Number For A New Baby

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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Claim That Politicians Exempted Themselves From The Tax

Critics of Social Security have said that the politicians who created Social Security exempted themselves from having to pay the Social Security tax. When the federal government created Social Security, all federal employees, including the president and members of Congress, were exempt from having to pay the Social Security tax, and they received no Social Security benefits. This law was changed by the Social Security Amendments of 1983, which brought within the Social Security system all members of Congress, the president and the vice president, federal judges, and certain executive-level political appointees, as well as all federal employees hired in any capacity on or after January 1, 1984. Many state and local government workers, however, are exempt from Social Security taxes because they contribute instead to alternative retirement systems set up by their employers.

Estimated Net Benefits Under Differing Circumstances

Good Question: Why Are Social Security Benefits Taxed?

In 2004, Urban Institute economists C. Eugene Steuerle and Adam Carasso created a Web-based Social Security benefits calculator. Using this calculator it is possible to estimate net Social Security benefits for different types of recipients. In the book Democrats and Republicans âRhetoric and Reality Joseph Fried used the calculator to create graphical depictions of the estimated net benefits of men and women who were at different wage levels, single and married , and retiring in different years. These graphs vividly show that generalizations about Social Security benefits may be of little predictive value for any given worker, due to the wide disparity of net benefits for people at different income levels and in different demographic groups. For example, the graph below shows the impact of wage level and retirement date on a male worker. As income goes up, net benefits get smaller âeven negative.

However, the impact is much greater for the future retiree than for the current retiree . The male earning $95,000 per year and retiring in 2045 is estimated to lose over $200,000 by participating in the Social Security system.

The next image shows estimated net benefits for married men and women at different wage levels. In this particular scenario it is assumed that the spouse has little or no earnings and, thus, will be entitled to collect a spousal retirement benefit. According to Fried:

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Direct Deposit: Its The Law

Effective March 2013, a new law went into effect requiring that all Social Security benefits be paid electronically. This means benefits due to you are directly deposited into a bank account of your choosing. The change means a quicker delivery of benefits as well as being safer and more convenient for customers.

The U.S. Treasury administers the Direct Deposit program and can answer questions for customers who call their helpline at 1-800-333-1795. For information and to sign up for the electronic delivery of funds, go to the Go Direct website at

The Treasury will also grant waivers in rare instances. To request a waiver or for more information, call 1-855-290-1545.

How to contact the Social Security Administration


Phone: 1-800-772-1213

TTY number: 1-800-325-0778

E-mail: Fill out a contact form located at

Survivor And Death Benefits

Wage earners depend on Social Security retirement benefits to help meet financial needs when they stop working, but sometimes these earners can pass away early and unexpectedly. When workers pay into Social Security, a majority goes to fund disability and retirement costs, but a portion of their taxes go toward survivors benefits as well.

When a worker passes away, some family members may be eligible for survivors benefits if the worker earned enough credits during their working lifetime. Eligible family members include widowed spouses who are 60 or older, 50 or older if they are disabled, or any age if caring for a child who is under 16 years old. Children of deceased workers are also eligible if they are not married and under 18 years old, or under 19 years old but still in school. If youre divorced and you or your spouse pass away, the surviving spouse could be eligible for a widows benefit as well.

If a worker has enough work credits when they pass away, Social Security will also make a one-time payment of $255. This payment can be made only if the spouse or child meet certain specified requirements.

To apply for survivors benefits, Social Security will need the following, either original copies or certified copies, from the issuing agency.

  • Proof of death from a funeral home or a death certificate
  • Social Security numbers for the applicant and the deceased person
  • The applicants birth certificate
  • Dependent childrens Social Security numbers and birth certificates
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    Fact #: Most Elderly Beneficiaries Rely On Social Security For The Majority Of Their Income

    Social Security provides the majority of income to most elderly Americans. For about half of seniors, it provides at least 50 percent of their income, and for about 1 in 4 seniors, it provides at least 90 percent of income, across multiple surveys and the study that matches survey and administrative data.

    How To Appeal A Social Security Claim That Has Been Denied

    Am I Eligible for Any of My Ex

    Almost half of all Social Security benefit applications are denied. While the vast majority of these deal with disability benefits, sometimes retirement benefits are denied as well.

    Some of the reasons why a retirement benefit application might be denied include:

    • You have not accumulated enough work credits in your work life
    • Your application has missing or incorrect information
    • You submitted your application too early. You cant apply until about four months before you turn 62.
    • You are already receiving Social Security disability benefits. Retirement and disability payments serve the same purpose to provide financial security when a person is not able to work any longer.
    • If you are a surviving spouse, you do not meet the minimum age requirement or you got remarried before you turned 60.

    If your benefit application is denied, you must submit an appeal within 60 days after you get a written notice from SSA. To start the appeal process, complete Form SSA-561-U2 Request for Reconsideration. Explain your reasons for seeking reconsideration and submit any additional documentation that will help you make your case to Social Security officials.

    The Request for Reconsideration is the first of four possible levels of appeal for Social Security retirement benefits. It is an informal review of your application and in many instances, when new information is submitted or issues are clarified, this level of appeal can lead to a reinstatement or approval of benefits.

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