Question on SS earning

[oldtrig]

I know this subject has probably come up before but I will ask again. I retired March 1st of this year. In January and February I made about $20,000. Will that count toward my total earning for the year or does it start the day I went on SS? I think it starts the day I did retire but I wanted to make sure? I have been offered a part time job for the rest of the year that would put me right at the total I can make for someone age 65 and not have to pay back any SS. Thanks

 

[MichaelB]

Hi Oldtrig. In your retirement year SS looks at your monthly income after your retirement date, so you should be ok.

Some people who retire in mid-year have already earned more than their yearly earnings limit. That is why we have a special rule that applies to earnings for one year, usually the first year of retirement.

The special rule lets us pay a full Social Security check for any whole month we consider you retired, regardless of your yearly earnings. If you will

be under full retirement age for all of 2012, you are considered retired in any month that your earnings are $1,220 or less and you did not perform substantial services in self employment

reach full retirement age in 2012, you are considered retired in any month that your earnings are $3,240 or less and you did not perform substantial services in self employment

 

[ziggy29]

Hi Oldtrig. In your retirement year SS looks at your monthly income after your retirement date, so you should be ok.

This example seems to specifically refer to someone who has reached FRA. It's not clear from this example whether it also applies to someone retiring before their FRA.

 

[MichaelB]

This example seems to specifically refer to someone who has reached FRA. It's not clear from this example whether it also applies to someone retiring before their FRA.

It's both. The original SS quote has bullet points. If one is less than FRA one can earn up to $1220, and if one is FRA one can earn up to $3240, each per month, without penalty. I see now I neglected to link. I'll look for that and post it for further explanation.

Edit: here's the link http://www.socialsecurity.gov/retire2/rule.htm

 

[BLS53]

Being SS gets their income data from the IRS, I don't think it matters whether the income was received prior to drawing SS benefits. If both were received in the same tax year, the months the income was earned shouldn't have a bearing. You received SS during the year, and you earned this much money from work this year.

 

[Dreamer]

It's both. The original SS quote has bullet points. If one is less than FRA one can earn up to $1220, and if one is FRA one can earn up to $3240, each per month, without penalty. I see now I neglected to link. I'll look for that and post it for further explanation.

Edit: here's the link Retirement Planner: Special Earnings Test Rule

Be careful not to go over the monthly amount by even $1.00. If you do, then you are not eligible to receive your social security check for the month. It can be a costly mistake to over the monthly amount that first year.

 

[kaneohe]

Being SS gets their income data from the IRS, I don't think it matters whether the income was received prior to drawing SS benefits. If both were received in the same tax year, the months the income was earned shouldn't have a bearing. You received SS during the year, and you earned this much money from work this year.

How does one decide between a gut feeling and what I assume is a quote from SS in Michael B's post?

"Some people who retire in mid-year have already earned more than their yearly earnings limit. That is why we have a SPECIAL rule that applies to earnings for ONE year, usually the FIRST year of retirement."

 

[MichaelB]

How does one decide between a gut feeling and what I assume is a quote from SS in Michael B's post?

"Some people who retire in mid-year have already earned more than their yearly earnings limit. That is why we have a SPECIAL rule that applies to earnings for ONE year, usually the FIRST year of retirement."

Right. It is a quote from SS, the link is in my second post. They actually describe two different situations. One is when one receives income after the retirement date but is directly derived from pre-retirement labor. For example, a bonus, vacation days, etc. The second example is new income earned after retiring. The SS is quite specific about the exceptions and monthly accounting in the year of retirement.

Anyone with any doubt only needs to follow the link above.

 

[kaneohe]

No doubts here, Michael. I think SS did a great job in providing for and describing a common situation and you did too in providing the link.

 

[BLS53]

How does one decide between a gut feeling and what I assume is a quote from SS in Michael B's post?

"Some people who retire in mid-year have already earned more than their yearly earnings limit. That is why we have a SPECIAL rule that applies to earnings for ONE year, usually the FIRST year of retirement."

Never said my statement was factual, and I didn't see the quote from SS. I made a mistake. Alright?

 

[oldtrig]

Being we are still on this subject I have one more question if I may. This part time job will pay family insurance. My wife is not 65 yet and has 18 months more until she will be. I have a Medicare supplement. Can I just cancel the supplement until I leave this job and not be penalized? Could have the money that is being taken from my SS stopped? I guess you could say I would not pay part A. I know Medicare will be first and private insurance second. I may not stay on this job long, maybe two years. I just hate to pay $124 per month for the supplement when I would have insurance. This may not ever happen anyway as I may turn the job down. I have not made of my mind yet. Thanks. oldtrig