IMPACTS BENEFITS HOW A JOB Once you reach full retirement age, there is no longer an earnings limit, meaning you can earn any amount of income without it impacting your benefits.
To calculate your annual earnings, the Social Security Administration includes wages, bonuses, commissions and vacation pay. It doesn’t count pensions, annuities, investment income, veterans or other government or military retirement benefits. 16
However, if you begin drawing Social Security benefits before you reach full retirement age and your earnings exceed the eligible limit, your benefits will likely be reduced.13 You may earn up to $18,240 in 2020 before your Social Security benefits will be reduced. Thereafter, $1 in benefits will be deducted for every $2 earned above $18,240. 14 In the year you reach full retirement age, you may earn up to $48,600 (in 2020) ending the month before your birthday before benefits are reduced. Thereafter, $1 for every $3 earned above $48,600 will be deducted from your benefits.15 In both scenarios, however, your benefit will be increased at full retirement age to account for benefits withheld due to earlier earnings.
:8: This document is designed to provide general information on the subjects covered. It is not, however, intended to provide specific legal or tax advice and cannot be used to avoid tax penalties or to promote, market or recommend any tax plan or arrangement. Individuals are encouraged to consult with a qualified professional before making any decisions about their personal situation. This content is not endorsed by the Social Security Administration, and our firm is not affiliated with the United States government or any other governmental agency. 13 Social Security Administration. “Benefits Planner: Retirement — How Much Can I Earn and Still Get Benefits?” https://www.socialsecurity.gov/planners/ retire/ whileworking.html. Accessed Feb. 29, 2020. 14 Social Security Administration. “Fact Sheet: 2020 Social Security Changes.” https://www.ssa.gov/news/press/factsheets/colafacts2020.pdf. Accessed Feb. 29,2020. 15 Ibid. 16 Social Security Administration. “Benefits Planner: Retirement — How We Deduct Earnings From Benefits.” https://www.ssa.gov/planners/retire/whileworking2. html. Accessed Feb. 29, 2020. This document is designed to provide general information on the subjects covered. It is not, however, intended to provide specific legal or tax advice and cannot be used to avoid tax penalties or to promote, market or recommend any tax plan or arrangement. Individuals are encouraged to consult with a qualified professional before making any decisions about their personal situation. This content is not endorsed by the Social Security Administration, and our firm is not affiliated with the United States government or any other governmental agency.
Made with FlippingBook - Online magazine maker