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What will happen if I have been drawing a social security…

Customer Question
What will happen if...

What will happen if I have been drawing a social security check for just over a year and I have been making well over the allowed amount for most of that time?

Accountant's Assistant: What state are you in? It matters because laws vary by location.

Iowa

Accountant's Assistant: Has anything been filed or reported?

I received a 1099 for 2016 taxes and ended up paying in about $2500. I have received nothing from the IRS.

Accountant's Assistant: Anything else you want the lawyer to know before I connect you?

Just wondering if I will have to repay that money or if the IRS will stop the checks for a certain amount of time. I was 63 when I started.

Submitted: 8 months ago.Category: Tax
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Answered in 6 minutes by:
9/8/2017
Tax Professional: Lev, Tax Advisor replied 8 months ago
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 32,859
Experience: Taxes, Immigration, Labor Relations
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You can get Social Security benefits and work at the same time.

However - EARNED income - wages or self-employment income - may affect your benefits.

if you are younger than full retirement age and make more than the yearly earnings limit, the SSA will reduce your benefit. Starting with the month you reach full retirement age, the SSA will not reduce your benefits no matter how much you earn.

.

The SSA will use the following earnings limits to reduce your benefits: If you are under your FRA - full retirement age for the entire year, we deduct $1 from your benefit payments for every $2 you earn above the annual limit. For 2017 that limit is $16,920.

When the SSA will get information about your earning from the IRS - and if your income is above that level - they will ask you to pay back certain amount.

Questions?

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Customer reply replied 8 months ago
Will I have to repay the amount or will they just withhold future checks for the period of time I received them?
Tax Professional: Lev, Tax Advisor replied 8 months ago

Based on each year earning - you will have to pay back $1 from your benefit payments for every $2 you earn above the annual limit.

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Tax Professional: Lev, Tax Advisor replied 8 months ago

For instance - if your 2017 earning will be $20,000

That means - you would have above the limit $20,000 - $16,920 = $3080.

and your repayment will be $3080 / 2 = $1540.

The SSA will agree to withhold from your coming social security benefits.

When they send you a repayment request - you may call back and ask to withhold from coming payments.

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