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Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 28082
Experience:  Taxes, Immigration, Labor Relations
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My husband & I own a small business in WI. (He is age 65 & I

Customer Question

My husband & I own a small business in WI. (He is age 65 & I am 64). He does not collect social security yet. I have been told that I should be drawing a wage under his social security as I am not a paid employee? Also, what age can he draw his social security without a penalty when he is still working?
Submitted: 1 year ago.
Category: Tax
Expert:  Lev replied 1 year ago.

Generally if the business is not set as a corporation - both of you woudl receive self-employment income from that business - not wages.
But for social securing purposes it woudl not matter as you will earn credits and pay to social security via self-employment taxes.
Regarding earning limit - that would NOT apply when you reach a full retirement age - which is 66 years in your case.

Expert:  Lev replied 1 year ago.

You can get Social Security retirement benefits and work at the same time. However, if you are younger than full retirement age and make more than the yearly earnings limit, SSA will reduce your benefit.

Starting with the month you reach full retirement age, SSA will not reduce your benefits no matter how much you earn.

For 2015 that limit is $15,720.

In the year you reach full retirement age, SSA will deduct $1 in benefits for every $3 you earn above a different limit, but SSA will only count earnings before the month you reach your full retirement age.

If you were reach full retirement age in 2015, the limit on your earnings for the months before full retirement age is $41,880.

For 2016 these limits are not yet set.

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