You can get Social Security retirement or survivors benefits and work at the same time. But, if you’re younger than full retirement age, and earn more than certain amounts, your benefits will be reduced. The amount that your benefits are reduced, however, isn’t truly lost. Your benefit will increase at your full retirement age to account for benefits withheld due to earlier earnings. Spouses and survivors, who receive benefits because they have children who are minor or have disabilities in their care, don’t receive increased benefits at full retirement age if benefits were withheld because of work. NOTE: Different rules apply if you receive Social Security disability benefits or Supplemental Security Income payments. Then you must report all earnings to us. Also, different rules apply if you work outside the United States. Contact us if you’re working (or plan to work) outside the country.
How much can you earn and still get benefits?
If you were born January 2, 1960 or later, then your full retirement age for retirement insurance benefits is 67. If you work, and are full retirement age or older, you may keep all of your benefits, no matter how much you earn. If you’re younger than full retirement age, there is a limit to how much you can earn and still receive full Social Security benefits.
If you’re younger than full retirement age during all of 2022, we must deduct $1 from your benefits for each $2 you earn above $19,560.
If you reach full retirement age during 2022, we must deduct $1 from your benefits for each $3 you earn above $51,960 until the month you reach full
These examples show how the rules would affect you:
Let’s say that you file for Social Security benefits at age 62 in January 2022 and your payment will be $600 per month ($7,200 for the year). During 2022, you plan to work and earn $23,920 ($4,360 above the $19,560 limit). Social Security would withhold $2,180 of your Social Security benefits ($1 for every $2 you earn over the limit). To do this, we would withhold all benefit payments from January 2022 through April 2022. Beginning in May
2022, you would receive your $600 benefit and this amount would be paid to you each month for the remainder of the year. In 2023, we would pay you the additional $380 we withheld in April 2022. Or, let’s say you weren’t yet full retirement age at the beginning of the year, but reach it in November 2022. You expect to earn $52,380 in the 10 months from January through October. During this period, we would withhold $140 ($1 for every $3 you earn above the $51,960 limit). To do this, we would withhold your first check of the year. Beginning in February 2022, you would receive your $600 benefit, and this amount would be paid to you each month for the remainder of the year. In 2023, we would pay you the remaining $460 we withheld in January 2022.
What income counts…and when do we count it?
If you work for someone else, only your wages count toward Social Security’s earnings limits. If you’re self-employed, we count only your net earnings from self-employment. For the earnings limits, we don’t count income such as other government benefits, investment earnings, interest, pensions, annuities, and capital gains. We do count an employee’s contribution to a pension or retirement plan, however, if the contribution amount is included in the employee’s gross wages. If you work for wages, income counts when it’s earned, not when it’s paid. If you have income that you earned in one
year, but the payment was made in the following year, it shouldn’t be counted as earnings for the year you receive it. Some examples are accumulated sick or vacation pay and bonuses. If you’re self-employed, income counts when you receive it — not when you earn it — unless it’s paid in a year after
you become entitled to Social Security and earned before you became entitled.
Special rule for the first year you retire Sometimes people who retire in mid-year already have earned more than the annual earnings limit. That’s why there is a special rule that applies to earnings for one year, usually the first year of retirement. Under this rule, you can get a full Social Security check for any whole month you’re retired, regardless of your yearly earnings. In 2022, a person younger than full retirement age for the entire year is considered retired if monthly earnings are $1,630 or less. For example, Terry Davis retires at age 62 on October 30, 2022. He will earn $45,000 through October. He takes a part-time job beginning in November earning $500 per month. Although his earnings for the year substantially exceed the 2022 annual limit ($19,560), he will receive a Social Security payment for November and December. This is because his earnings in those months
are $1,630 or less, the monthly limit for people younger than full retirement age. If Mr. Davis earns more than $1,630 in either November or December, he won’t receive a benefit for that month. Beginning in 2023, only the annual limit will apply to him.
Also, if you’re self-employed, we consider how much work you do in your business to determine whether you’re retired. One way is by looking at the amount of time that you spend working. In general, if you work more than 45 hours a month in self employment, you’re not retired; if you work less than 15 hours a month, you’re retired. If you work between 15 and 45 hours a month, you won’t be considered retired if it’s in a job that requires a lot of skill, or you’re managing a sizable business.
Should you report changes in your earnings?
We adjust the amount of your Social Security benefits in 2022 based on what you told us you would earn in 2022. If you think your earnings for 2022 will be different from what you originally told us, let us know right away. If other family members get benefits based on your work, your earnings from work you do after you start getting retirement benefits could reduce their benefits, too. If your spouse and children get benefits as family members, however, earnings from their own work affect only their own benefits.
Will you receive higher monthly benefits later if benefits are withheld because of work? Yes. If some of your retirement benefits are withheld because of your earnings, your monthly benefit will increase starting at your full retirement age. This is to take into account those months in which benefits were withheld. As an example, let’s say you claim retirement benefits upon turning 62 in 2022, and your payment is $910 per month. Then, you return to work and have 12 months of benefits withheld.
We would recalculate your benefit at your full retirement age of 67 and pay you $975 per month (in today’s dollars). Or, maybe you earn so much between the ages of 62 and 67 that all benefits in those years are withheld. In that case, we would pay you $1,300 a month starting at age 67.
Are there other ways that work can increase your benefits?
Yes. Each year we review the records for all Social Security recipients who work. If your latest year of earnings turns out to be one of your highest years, we refigure your benefit and pay you any increase due. This is an automatic process, and benefits are paid in December of the following year. For example, in December 2022, you should get an increase for your 2021 earnings if those earnings raised your benefit.
The increase would be retroactive to January 2022