Ask Larry: Which Months Of My Earnings Count Toward Social Security’s Earnings Limit?

Retirement

Today’s Social Security column addresses questions about when annual earnings limits are applied, survivor benefits after remarriage and child benefits when a parent is receiving disability benefits. Larry Kotlikoff is a Professor of Economics at Boston University and the founder and president of Economic Security Planning, Inc.

See more Ask Larry answers here.

Have Social Security questions of your own you’d like answered? Ask Larry about Social Security here.


Which Months Of My Earnings Count Toward Social Security’s Earnings Limit?

Hi Larry, I started receiving my Social Security benefits in early 2021 at 65 and two months. My full retirement age is 66 and four months. I am restricted to making $18,960 without penalty. does the $18,960 ceiling go thru December 2021 and start over in January 2022?

Or does it go from March 2021 thru March 2022 and start over in April 2022 until I reach 66 and four months full retirement in mid 2022? Thanks, David

Hi David, The exempt amount of $18,960 is the amount you can earn from January 1 2021 through December 31 2021 without losing any of your benefits this year. If you go over that amount then Social Security would need to withhold $1 of your benefits for every $2 earned in excess of $18,960.

However, you could be paid at least for any months this year that you earn no more than $1,580 regardless of how much you earn in the full year.

Since you’ll be turning full retirement age (FRA) next year a higher exempt amount will apply and only the amount you earn in months prior to the month you reach FRA will count.

You may want to consider using my company’s software — Maximize My Social Security or MaxiFi Planner — to fully analyze your options. It accounts for the earnings test so you can make informed decisions about your best strategy for maximizing your benefits and avoid unknowingly leaving money on the table. Social Security calculators provided by other companies or non-profits may provide proper suggestions if they were built with extreme care. Best, Larry


Can I Draw Social Security Off Of A Deceased Spouse If I Had Already Remarried?

Hi Larry, my first spouse passed away a number of years ago and I’ve since remarried. Would it be possible to draw survivor’s benefits on the record of my first spouse? Thanks, Richard

Hi Richard, You can potentially qualify for surviving spousal benefits on the record of a late spouse even if you subsequently remarry, but only if your subsequent marriage has ended in death or divorce, or if your subsequent marriage occurred after you reached age 60.

If you were over 60 when you remarried, you could potentially draw survivor’s benefits based on their record. Best, Larry


Can I Get Child Benefits For My Ten Year Old Daughter?

Hi Larry, I just received approval for SSDI and am wondering if I can get my 10 year old daughter child benefits. I am not married to her mother and we have separate homes but have shared custody of her and get along well. The child benefits would come in handy to help with our expenses. Thanks, Al

Hi Al, Child benefits can potentially be paid when a parent is receiving Social Security disability (SSDI) benefits, if the child is either a) under age 18, or b) age 18 to 19 and in high school, or c) disabled due to an impairment that began prior to age 22.

Sometimes though, the family maximum benefit (FMB)

FMB
payable on a person’s SSDI account only allows the worker to be paid and not any eligible family members. You’ll need to check with Social Security to see if the FMB on your record will allow child benefits to be paid.

Also, Social Security appoints a representative payee to handle benefit payments for minor children, and the representative payee is required to use the child’s benefits for the child’s current needs or save the benefits for the child’s future needs. In a shared custody situation, only one parent can be appointed as representative payee, although the representative payee can be changed if circumstances change.

ocial Security generally selects the parent who has primary custody as representative payee for a minor child. Best, Larry


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