Social Security’s “First Year” Rule: When you claim early and still work
Here at The AMAC Foundation, we often hear from folks who are vaguely aware that if they collect Social Security benefits early and continue to work, their benefits may be affected. The details of Social Security’s “Earnings Test” can be tricky, especially during the first year of collecting early benefits, where “early” is defined as anytime before one’s Social Security full retirement age. And Social Security’s so-called “first year rule” has surprised many a new recipient. Intended as a way to accommodate those who claim Social Security mid-year but have already earned more than allowed by the earnings test, the first year rule uses a monthly, rather than annual, earnings limit for the remainder of the calendar year in which a person starts benefits. All of this is explained in this Motley Fool article by Katie Brockman. Click here to read more.
Also, if you’re unsure about your individual situation under Social Security or have questions about your personal benefit entitlements, note that the AMAC Foundation provides an independent free-to-the-public Social Security Advisory service to help Americans navigate the complexities of this program. Learn more about it here…
I am thinking of retiring in July 2025, I will be over the earnings amount, if I request my first ssc for august will I get my full check?
Hello Linda,
You will get your full benefit. Because you have gone over the earnings limit already you can use the Monthly Limit of $1,950.00 next year for your income from August through December. It is important that you keep records of your income so it will be documented for Social Security when they send a letter questioning the overage next year. Social Security will not realize you went over the annual limit until they get your tax information from the IRS next year.
Please give us a call at 888-750-2622 or email ssadvisor@amacfoundation.org if you have further questions and we will be happy to help.
Thank you for contacting us.
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If I take social security at 62 when I reach full retirement can I still work and have no deduction from my social security
Ronald:
The earnings test does not apply after full retirement age (FRA) is reached. Starting at the month you reach FRA, earnings will no longer affect your monthly Social Security benefit, regardless of how much you earn. The annual earnings limit increases by about 2 ½ times during the year FRA is reached and disappears completely once FRA is attained. So yes, you can work after reaching your FRA with no Social Security deduction.
Thanks for contacting us!
Gerry Hafer
AMAC Foundation
CONFIDENTIALITY NOTICE: The opinions and interpretations expressed in this message are the viewpoints of the message’s author, a trained advisor accredited under the National Social Security Advisors program of the National Social Security Association, LLC (NSSA). The author, the NSSA, and the AMAC Foundation are not affiliated with or endorsed by the United States Government, the Social Security Administration, or any other state government.