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LawTalk
LawTalk, Attorney
Category: Social Security
Satisfied Customers: 35390
Experience:  I have 30 years of legal and litigation experience, including representing clients before the U.S. Social Security Administration.
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Eligible now at 62. My state retirement will cut my pension

Customer Question

Eligible for SS now at 62. My state retirement will cut my pension $500.00 per month beginning now. State retirement $1250.00 mo. SS income $1500 mo. Currently employed full time. Average annual income working full time $30,000. Which would I be better off?
Thank You.
Submitted: 4 months ago.
Category: Social Security
Expert:  LawTalk replied 4 months ago.

Good afternoon,

I'm Doug, and I'm sorry to hear of the confusion. My goal is to provide you with excellent service today.

You are better off delaying social security until you are either retired or earning less than 30K a year, because for each 2 dollars you earn through work (if you continue to work) over $15,720 per year, you must pay 1 dollar back to social security. This penalty ends when you reach 66.

And if you take both social security and your state pension at the same time, social security will decrease your social security benefit based on the Windfall Elimination Provision.

If you will be receiving an annuity/pension payment from a retirement system where you did not pay Social Security taxes, you’ll be subject to the Windfall Elimination Provision (WEP). The WEP will reduce your Social Security benefit if you have fewer than 30 years of “substantial earnings” under Social Security. Substantial earnings are greater than those required to earn Social Security credits. To see what substantial earnings are by year see this link:

https://socialsecurity.gov/pubs/EN-05-10045.pdf

This is a very complex area of Social Security law, and therefore, I will point you to this excellent primer on the WEP:

https://socialsecurity.gov/pubs/EN-05-10045.pdf

Generally, if a person qualified for their non-social security pension after December 1, 1982, and they worked less than 20 years in a job where they paid social security taxes, then up to 1/2 of their non-social security pension benefit would be applied (deducted) against any expected Social Security benefit.

You may well be better off continuing to work and allow your social security benefit to grow in value.

You may reply back to me using the Reply link and I will be happy to continue to assist you until I am able to address your concerns, to your satisfaction.

I hope that I have been able to fully answer your question. As I am not an employee of JustAnswer, please be so kind as to rate my service to you. That is the only way I am compensated for assisting you. Thank you in advance.

I wish you and yours the best in 2016,

Doug

Expert:  LawTalk replied 4 months ago.

This seems like a very crucial matter for you, and your questions and issues suggest that an in-depth conversation might best suit your needs. If you are interested, for a very nominal charge I can offer you a private phone conference as opposed to continuing in this question and answer thread which is searchable and viewable by the public.

If I have already provided you with the information you asked for, would you please now rate my service to you so I can be compensated for assisting you?

Thanks in advance,

Doug

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