How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Lane Your Own Question
Lane
Lane, JD,CFP, MBA, CRPS
Category: Social Security
Satisfied Customers: 11361
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial, Social Security & Tax advice since 1986
1929974
Type Your Social Security Question Here...
Lane is online now
A new question is answered every 9 seconds

I retired at age 62, but continue to work as an independent

Customer Question

I retired at age 62, but continue to work as an independent piano technician. I continue to pay into social security via form SE on income tax forms. The amount paid in is at least $8000. I don't get back much of that as my monthly payments have gone up little. They give you a little more on one payment and then it goes back to a lower amount quite soon. I would rather not have to keep paying into SS. I am now 71 years young and still tuning pianos. We also have farm income with cattle being the only taxable income.
Submitted: 5 months ago.
Category: Social Security
Expert:  Lane replied 5 months ago.

Hi. My name's Lane. I can help explain how this works.

...

Social Security uses your highest 35 years of earnings to calculate your retirement benefit, so continuing to work may or may NOT add to your benefit.

...

It, of course, adds to your total income ... but unless you are earning a lot MORE these days (or another example would be if you didn't HAVE 35 in years in the system, so that an additional year working replaces a zero in the average) it may not increase your benefits.

...

Your situation is one of the bigger "gotcha's" in the system. If you work, you have to pay-in, (as you know, either through schedule SE or through FICA as an employee) even though you don't directly benefit from it.

...

That has to do with the fact that this is a form of Social Insurance ... The formula that's used is another product of this being social insurance; Basically, it's a set of calculations that helps level the playing field between lower wage earners and higher wage earners. For instance, low wage earners who retired at age 66 in January 2009 got benefits that replaced about 56 percent of their pre-retirement income; for high wage earners, the figure was 34 percent.

...

I hope this helps to make what you're seeing make some sense.

...

Please let me know your questions from here.

...

Lane

...

...

I have a Law degree with concentration in Tax , Estate & Corporate Law, … an MBA, with specialization in finance … a BBA, and CFP & CRPS designations, as well - I’ve been providing financial, Social Security/Medicare, estate, corporate, non-profit, and tax advice, since 1986

Customer: replied 5 months ago.
Thanks for your info. I was born in 1945 and started working in 1968 after college. I didn't make much and was feeling my way along. Was learning piano tuning while working cheap . Got married in 1978. She had a farm with some crop income. We got into raising cattle, but had some negative income years with cattle. It was a fun thing to do, but financially not smart. She was also a school teacher. I used the schedule f loss to reduce my schedule c so that I was paying little or nothing into social security for some years. I have been making considerably more for the past 15 or so years. Also I was noticing that I didn't use a big schedule f loss in 2012 ($25,000) against scbedule c thinking that it would help my ss payments. Is it too late to modify our 2012 return? We would have gotten an additional $3000 back on income tax. We still got about a $15,000 refund as I recall. I was also worried that I might get audited for having such a big loss. We had to buy a lot of hay that year. Anyway I think that I would come out better if ss was recalculating and putting the higher income years in to offset the low ones. The last 5 years shows a much higher income. This year not so much since I had to slow down due to an arm injury.Thanks.
Expert:  Lane replied 5 months ago.

The statute of limitation for filing a refund for refund purposes is three years. (stars with the due date for the return in question), which would have been Apr of 2013 .. so, so sorry, the amended return need to have been filed by Apr of 2016.

...

But on the other par of what you've said, the generally higher years later should help.

...

Expert:  Lane replied 5 months ago.

If you'll go here, you can enter your earnings and see that they're giving you the right benefit (they WILL re-calculate after every year that you work): https://www.ssa.gov/planners/benefitcalculators.html

...

Please Let me know if you have ANY questions, before rating me.

But if this HAS helped, and you don’t have more questions on this, I’d appreciate a positive rating (by using those stars on your screen, and clicking submit) … Otherwise JA won’t compensate me for the work.

Thank you,

Lane