Q & A
Ask Rusty – Can I Increase My Benefit by Withdrawing from Social Security?
Dear Rusty: I’m 67 and have been collecting Social Security for a couple of years now but I want to increase my benefit. Will you please explain what Social Security’s Form SSA-521 is for? Would it benefit me as a retiree to be able to gain more on my monthly benefits? Where and how could I request or access this form? Signed: Seeking Answers
Dear Seeking: Social Security’s Form SSA-521, Request for Withdrawal of Application, is used when someone has applied for Social Security benefits and later decides they do not want to collect their benefits after all. The form can be submitted within 12 months of the start-date of your benefits, and if approved will require that all benefits which have been paid to you, or on your behalf by Social Security – including Medicare premiums, withheld taxes and any benefits (including those paid to your spouse or any other dependents on your record) – are fully reimbursed to the Social Security Administration. It might be used, for example, by those who claim prior to their full retirement age, perhaps because they become unemployed and need the money, and then later become employed again. Or it might be used by someone who applies for benefits early but later simply change their mind and now wants to delay claiming to increase their benefit amount. This form is how someone can initiate the “do over option” that you sometimes hear Social Security pundits speak of. It essentially “wipes the slate clean” with Social Security, but it cannot be used by someone who has been collecting benefits for more than one year and it cannot be used more than once in your lifetime.
From what you have told me, the Request for Withdrawal of Application Form SSA-521 will not work for you. However, there is another way you can increase your Social Security benefit. Since you have already reached your full retirement age you can now request that Social Security “suspend” your benefit payments so that you can earn “delayed retirement credits” (DRCs). If you suspend your benefits, you’ll earn DRCs at the rate of 2/3rds of 1% per month you delay (8% per year of delay), and when you eventually restart your benefits the amount will be higher (how much higher depends upon the number of months your benefits have been suspended). You can earn DRCs up to age 70, so you should not wait beyond age 70 to restart your benefits. But beware, because there’s a catch to suspending your benefits – your spouse, or any other dependent, cannot collect benefits based upon your work record while your benefits are suspended. And if your Medicare Part B premium is deducted from your Social Security payment, you’ll need to make special arrangements to pay that Part B premium directly to Medicare.
If you decide to suspend and allow your benefit to grow, you will need to contact Social Security directly, either via the general number (800.774.1213) or by contacting your local office (find it at www.ssa.gov/locator). You may ask Social Security to suspend your benefits either verbally or in writing. So, if you have found that you don’t need your Social Security benefit at this time and wish to allow it to grow, and you understand that anyone else collecting on your record cannot get benefits while you are not collecting, then suspending your benefits and restarting later would give you the higher benefit you are seeking. Your benefits will restart automatically the month you turn 70.
This article is intended for information purposes only and does not represent legal or financial guidance. It presents the opinions and interpretations of the AMAC Foundation’s staff, trained and accredited by the National Social Security Association (NSSA). NSSA and the AMAC Foundation and its staff are not affiliated with or endorsed by the Social Security Administration or any other governmental entity. To submit a question, visit our website (amacfoundation.org/programs/social-security-advisory) or email us at ssadvisor@amacfoundation.org.