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keeperumiami
keeperumiami, Senior Tax Expert & Financial Planner
Category: Social Security
Satisfied Customers: 6181
Experience:  Sr Tax Expert/Financial PlannerCPA/PFS (retired)Over forty years of advising individuals & small businesses
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I'm 64 years old drawing SS benefit and I returned to work

Customer Question

I'm 64 years old drawing SS benefit and I returned to work this past July. I have exceeded the allowable income limit this years and I cannot get a straight answer from SS on the situation. Will they withhold my future benefit for next year, can I just make payment, does the SS deducted from my check get applied to the overpayment? Just trying to figure out my option, do I quit work immediately, I don't plan to work next year since I can't afford this situation again. Is there any options to working next year and do I have any aptions right now to offset some of this penalty. Really need some advise
JA: These retirement benefits are supposed to help us but they can be so complicated! The Retirement Expert will help you get the most benefits propertly. Is there anything else the retirement accountant should be aware of?
Customer: Don't believe so, I'm currently $30,000 over the allowable limit, I just not how they will calculate the amount I will have to pay
JA: When we are ready I'll take you to the appropriate web page.
Customer: Thank you so much
Submitted: 23 days ago.
Category: Social Security
Expert:  keeperumiami replied 23 days ago.

Hello, my name is***** goal is to give you a complete & accurate answer. I am working on your request now & I will respond as soon as possible.

Expert:  keeperumiami replied 23 days ago.

They will withhold $1. in benefits for every $2. of earnings over the limit.

They will normally suspend your future payments until the benefit overpayment is paid back.

The Social Security tax withheld from your earnings does not offset any repayments you owe. It is a completely different matter and even when you are collecting Social Security benefit payments, you must pay the Social Security tax on any earnings.

If your current earnings exceed any year's earnings that entered into the original computation of your benefits, your benefits would automatically be increased to reflect that adjustment.

Each year stands on it's own, so you can earn up to the maximum amount next year ($15,720.) without affecting your benefits for next year (except to the extent that benefits are being withheld to account for the repayments you owe for this year (2016).

I think that covers all the questions you asked, but please ask any follow-up questions or if you need me to further clarify anything, just ask me.

Thanks very much,

Steve G.

Expert:  keeperumiami replied 23 days ago.

By the way, in the year that you reach full retirement age, 66, the earnings limit is increased to $41,880. applied on a monthly basis or $3,490. a month. (So, you can earn $3,490. a month before there's any reduction of your benefits). That only applies to the year your reach full retirement age.

After you reach age 66, there is no earnings limit and your benefits will not be reduced.

Steve G.