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Stephanie O Joy, Esq
Stephanie O Joy, Esq, Soc. Sec. Attorney
Category: Social Security
Satisfied Customers: 13568
Experience:  22+ years legal exp. - 12+ years owning/operating her own SSD Law practice.
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I understand there is a program in Social Security where you

Customer Question

I understand there is a program in Social Security where you can get an interest fee loan for a year. How do I find out more about this program?
Submitted: 1 year ago.
Category: Social Security
Expert:  TaxRobin replied 1 year ago.


What you have been told is about suspending payments. Under this , an individual 62 years or older can start collecting benefits but stop the benefits within 12 months of the start, repay the benefits collected, and then still be eligible for their higher benefit amount when they collect at full retirement age or older.

If you started receiving Social Security benefits less than 12 months ago and you changed your mind about when they should start, you may be able to withdraw your Social Security claim and re-apply at a future date.

That is ending soon. The SSA has issued this notice:

Effective April 30, 2016:

  • We will no longer permit suspension of retroactive benefits in situations where you apply for benefits and we have not yet made a determination regarding your entitlement.

  • If you voluntarily suspend your retirement benefit and you have others who receive benefits on your record, they will not be able to receive benefits for the same period that your benefits are suspended.

  • If you voluntarily suspend your retirement benefit, any benefits you receive on someone else’s record will also be suspended. Your Part B premiums cannot be deducted from your suspended benefits.

  • If you request voluntary suspension on or after April 30, 2016, we will only permit benefit reinstatement beginning with the month after the month of your request

Please remember to rate my service excellent once you have all the information you need. If you have any other questions, please ask me – I’ll be happy to respond. Thank you!

Expert:  Stephanie O Joy, Esq replied 1 year ago.

I see your expect opted out.

My name is***** and I am here to assist you. I am a social security attorney in my private practice – that is ALL I do. Please let me know that my post here is coming through for you by typing a quick reply.

Expert:  Stephanie O Joy, Esq replied 1 year ago.

At age 62, we can not 'suspend' payments at all. That is not available until we are of full retirement age and that right is not going away. See here regarding voluntary suspensions and the age requirement:

What is going away is the effect of what happens when we do suspend.

The "free loan", so called strategy, was this: When we apply for retirement, 62 or over, at times we soon decide we didn't want to do that and we rather NOT have applied at all. If we are within 12 months of our application, even if we have collected 11 payments, we can request a "withdrawal" of that application. It is a one time per lifetime event option. If we are permitted to withdraw, we return the moneys we took, without paying interest for that time we had the money - ergo the "free loan." This was a much bigger deal prior to about 5 years ago, when there was no 12 month time limit. Back in the day, people would "borrow" the payments for years and years, and then withdraw the application. In theory, they could have 70k in the bank (never spent, just put in an interest bearing account), earn the interest, then withdraw the application, keep the interest earned over those years on that money they didn't spend but just invested/saved, but pay back the principal. The SSA curbed that a few years back, but allowed the cruz of the righ to 'withdraw' an application to remain for 1 year after applying - to ensure it really does still allow for the mistaken decision, but not to encourage 'free loans'. Here is the SSA word on the right to withdraw an application:

Keep in mind that suspension of benefits, entirely different, is undergoing change in that you can still suspend after your FRA if you go back to work or otherwise decide you don't need them yet, but are under 70 and want to collect "delayed retirement benefits" so your benefit later, after suspending awhile, will grow by 8% per year deferred (up to age 70). The change is that IF you do suspend to grow your own benefits amount, your dependent's benefits on your record (if any) will also be suspended. So the COST of suspending can be very great.

Expert:  Stephanie O Joy, Esq replied 1 year ago.

I hope this helps! My goal is to provide you with excellent and accurate service – if you feel you have gotten anything less, please reply back, I am happy to address follow-up questions.

Kindly rate me "excellent"when you are done. I look forward to assisting you in the future, should you have legal questions. Be sure to start future posts with "To ***** Esq., ONLY" if you want me to specifically answer it.

Sincerely, ***** ***** Joy, Esq.

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