Q & A

When does the earnings limit start? I’m applying for benefits in June but will reach the earnings limit before then.

Complete Question: I am 63 years old and will start taking my Social Security benefits in June, 2015. When I talked to the Social Security office, they advised me that after I start receiving Social Security I will have a limit on income in the range of about $15,000. Since I am semi-retired now and still working up to that point, when does this limit begin? Does it start after June until the end of 2015? Or does it apply for all of 2015? By June I will have already earned over $15,000.

Answer: This is a very important consideration for many people. There is an annual earnings limit that applies before full retirement age (FRA). The limit for 2015 is $15,720 if you are not going to be 66 (full retirement age) this year. The good news is that the Social Security Administration has a special rule for your first year of retirement, which looks at your monthly earnings instead of your annual income. This means that anything you earned before your benefits begin will not count towards the earnings limit – so you do not have to worry about already reaching the limit before June. After that, you will be subject to a monthly earnings limit, which is $1,310 for your age for 2015. This means that if you earn less than $1,310 in a month after filing for your benefits, you will receive a benefit check. If you earn more than $1,310, you will not receive a payment that month.

It is important to know that the calculation will change in 2016. Since you will be starting a new year, you will be subject to the annual earnings limit rather than the monthly earnings limit. In addition, if you make more than the limit, you will receive a reduction in your payment instead of no payment at all.

Research Analyst & Certified Social Security Advisor
AMAC Foundation
Notice: If you have any additional questions about the earnings limits, or any other Social Security question, you can reply below. If you would like to discuss your situation privately, you can email C.J. at cmiles@amacfoundation.com. Please do not provide any personal identification information such as Social Security numbers.

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