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Paying social security tax after age 66
Old 03-10-2007, 12:00 PM   #1
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Paying social security tax after age 66

This may be a real dumb question, but if you continue to work past 66 (the time you start taking full SS benifits without penalty) do they continue to take out social security from your paycheck? If so, is it of any benifit to you or just money you will never see, which is what I presummed.
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Re: Paying social security tax after age 66
Old 03-10-2007, 12:16 PM   #2
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Re: Paying social security tax after age 66

You continue to pay SS tax as long as you work. Not sure if additional contributions are calculated into your benefit once you start drawing, but I'm sure you can look up the answer on the SS.org website.

Based on how little most folks SS income is reduced by retiring early, I doubt if there would be any real benefit, even if it is included in some sort of recalculation.


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Re: Paying social security tax after age 66
Old 03-10-2007, 03:59 PM   #3
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Re: Paying social security tax after age 66

I read on the website that they recalculate your benefit every year. If you have another year of contribution that exceeds a past year, then it can up your benefit. Keep in mind that their calculations include dollar normalization from past years to present years, so you may want to look at it in terms of did you have a max contribution year that will replace a 1/2 max contribution year.

Example:
My MIL has a short history, only been working for 15 years. She plans to work till 70, but will begin her benefits this year at 62. She will receive the reduced benefits due to her income now (-1 for every 2 in salary over $13000), but that reduction will be added back when she does fully retire. Also, every year she works till 70 replaces a 0 earnings year, so it will continue to make her benefits grow each year when they recalculate. Her yearly contributions are like 1/5 of max, so the recalculation doesn't put much more into her monthly benefit, but at least it is something.
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