Regardless of age or benefit eligibility, everyone engaged in self-employment or covered employment is required to pay Social Security taxes. But there are specific exclusions from paying Social Security taxes that are applicable regardless of age, such as a person who meets the requirements for a religious exemption. Use our online retirement application when you’re ready to apply for retirement benefits; it’s the quickest, easiest, and most convenient method available.
Can I work and still receive Social Security retirement benefits?
Yes, you can work and receive Social Security retirement benefits at the same time. However, if you are younger than full retirement age (FRA) and earn above a certain limit, your benefits will be reduced. This is known as the “earnings test.”
Earnings Limits for 2024:
- Under Full Retirement Age: For every $2 you earn above $22,320, $1 will be deducted from your benefits.
- Full Retirement Age Year: For every $3 you earn above $59,520 before the month you reach FRA, $1 will be deducted from your benefits.
- Full Retirement Age and Beyond: Once you reach full retirement age, there is no limit on how much you can earn without affecting your benefits.
How to Calculate Your Earnings Limit:
- Use the Social Security Administration’s (SSA) Retirement Earnings Test Calculator to estimate how much your benefits will be reduced based on your expected earnings.
- The SSA also provides a Retirement Age Calculator to determine your full retirement age based on your birthdate.
What Counts as Earnings?
- Wages from your job
- Net earnings from self-employment (after business expenses)
- Bonuses, commissions, and vacation pay
What Doesn’t Count as Earnings?
- Pensions
- Annuities
- Investment income
- Interest
- Veterans benefits
- Government or military retirement benefits
Benefits of Working While Receiving Social Security:
- Increased Benefits: As you continue to work and pay Social Security taxes, your future benefits may increase due to higher earnings.
- Delayed Benefits: If you delay claiming benefits past your FRA, your monthly payments will be permanently increased.
- Staying Active: Working can provide mental and physical stimulation, social interaction, and a sense of purpose.
Reporting Changes in Earnings:
- If you are under FRA and your earnings change, you must report them to the SSA immediately. You can do this by calling 1-800-772-1213 or visiting your local Social Security office.
Additional Resources:
- SSA Retirement Age Calculator: https://www.ssa.gov/benefits/retirement/planner/retirementage.html
- SSA Retirement Earnings Test Calculator: https://www.ssa.gov/benefits/retirement/planner/retirementage.html
- SSA Retirement Benefits: https://www.ssa.gov/benefits/retirement/
- SSA Earnings & International Operations: https://www.ssa.gov/international/
Remember:
- Working and receiving Social Security benefits can be a complex topic. It’s important to understand the earnings limits and how they affect your benefits.
- The SSA provides various resources to help you understand your options and make informed decisions.
- If you have any questions or need further assistance, contact the SSA directly.
Please note that I am not a financial advisor and cannot provide specific advice on your individual situation.
Everyone working in covered employment or self-employment regardless of age or eligibility for benefits must pay Social Security taxes. However, there are narrow exceptions to paying Social Security taxes that apply at any age, such as an individual who qualifies for a religious exemption. When you’re ready to apply for retirement benefits, use our online retirement application, the quickest, easiest, and most convenient way to apply.
It is possible to work and receive Social Security retirement benefits simultaneously. On the other hand, we will lower your benefits if you are under full retirement age and earn more than the annual cap. No matter how much you make, we won’t cut your benefits starting the month you reach full retirement age.
The maximum amount you can make in the months leading up to 2024, when you reach full retirement age, is $59,520.
Use our Retirement Age Calculator to find your full retirement age based on your date of birth.
Use our Retirement Earnings Test Calculator to find out how much your benefits will be reduced.
When you’re ready to apply for retirement benefits, use our online retirement application, the quickest, easiest, and most convenient way to apply.If you need to report a change in your earnings after you begin receiving benefits: If you receive benefits and are under full retirement age and you think your earnings will be different than what you originally told us, let us know right away. You cannot report a change of earnings online. Please call us at 1-800-772-1213 (TTY 1-800-325-0778), 8:00 a.m. – 7:00 p.m., Monday through Friday, or contact your local Social Security office.
Taxes on Social Security Income: 3 Things to Know
FAQ
How much of your Social Security income is taxable?
|
Combined Income
|
Social Security Tax Amount
|
|
Between $25,000 and $34,000 (single) or $32,000 and $44,000 (joint filing)
|
Up to 50% of Social Security benefits can be taxed
|
|
Above $34,000 (single) or above $44,000 (joint filing)
|
Up to 85% of benefits can be taxed.
|
Do you have to pay taxes on Social Security benefits?
You must pay taxes on up to 85% of your Social Security benefits if you file a: Federal tax return as an “individual” and your “combined income” exceeds $25,000. Joint return, and you and your spouse have “combined income” of more than $32,000. If you are married and file a separate return, you probably will have to pay taxes on your benefits.
Are Social Security benefits taxable After retirement?
Notably, 85% of your Social Security is potentially taxable after retirement. Your annual income will determine taxes on your benefits. If you file as an individual and your income is between $25,000 and $34,000, 50% of your benefits will be taxed. Any amount over $34,000 will qualify 85% of your benefits to be taxed.
Do seniors have to pay taxes on social security?
This means that seniors on Social Security whose income exceeds the Standard Deduction will need to determine if some of their Social Security benefits need to be included in their taxable income for federal taxes as well as for taxes in certain states. When do seniors have to file a tax return?
Is Social Security income taxable?
If your Social Security income is taxable, the amount you pay will depend on your total combined retirement income. However, you will never pay taxes on more than 85% of your Social Security income, though the income brackets will vary by filing status.