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Tax.appeal.168
Tax.appeal.168, Tax Accountant
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What is considered earned income that would affect social

Customer Question

What is considered earned income that would affect social security payments. In particular would interest cause a reduction in payments
Submitted: 1 year ago.
Category: Tax
Expert:  Tax.appeal.168 replied 1 year ago.

Based on the following information, the answer is no. SEE BELOW:

Pension payments, annuities, and the interest or dividends from your savings and investments are not earnings for Social Security purposes.

Only earned income, your wages, or net income from self-employment, is covered by Social Security.

You may have to pay income tax on pensions, annuities, interest, or dividends, but you do not pay Social Security taxes. Those types of income are not on your Social Security record.

REFERENCE SOURCE:

https://www.ssa.gov/planners/retire/annuities.html

Let me know if you require further assistance with this matter.

Expert:  Tax.appeal.168 replied 1 year ago.

Additional information that should be beneficial to you found at the following link:

https://www.irs.gov/Credits-&-Deductions/Individuals/Earned-Income-Tax-Credit/What-is-Earned-Income%3F

Customer: replied 1 year ago.
I want to make sure. If I am receiving social security now and take interest from annuities it will not fall under the annual income limit and start to reduce my social security payments
Expert:  Tax.appeal.168 replied 1 year ago.

SEE BELOW:

Social Security does not count pension payments, annuities, or the interest or dividends from your savings and investments as earnings. They do not lower your Social Security retirement benefits.

REFERENCE SOURCE:

https://faq.ssa.gov/link/portal/34011/34019/Article/3742/Will-withdrawals-from-my-individual-retirement-account-affect-my-Social-Security-benefits