2004-12-10 / Columnists

Social Security And You

By James Glasser, Manager, Far Rockaway Social Security Center


James Glasser
James Glasser With the holidays approaching, millions of Americans will take on seasonal jobs to bring in a little extra spending money. More than a few of these holiday workers will be older Americans who already get Social Security.

Of course, when people who get Social Security retirement benefits consider taking on seasonal work, benefit questions arise – so here are some of the more commonly asked questions and answers.

The main question is whether or not new earnings will effect current Social Security payments, and the answer is that depends on your age and the amount of earnings. If you have reached your full retirement age (between 65 and 67, depending on when you were born), you can earn all you want and not have a penny withheld from your benefits. If you are younger than your full retirement age we will not withhold anything from your monthly Social Security payment unless you earn more than $11,640 for the year. (That figure goes up to $12,000 in 2005.) If you do earn more than $11,640 for the year, we will withhold from your benefits $1 for every $2 you earn above that amount.

Another question we often get is this: Do I have to pay Social Security taxes on earnings if I am already getting Social Security? Yes, you do. Whether you are 16 or 116, your employer is required by law to withhold payroll taxes when you work.

Many people also want to know if any “extra” Social Security taxes they pay while working at a seasonal job will mean a higher Social Security retirement benefit later on. The answer is maybe, but probably not. Your original Social Security benefit was based on your highest years of earnings. 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 automatically refigure your benefits and pay you any increase due—which usually shows up in benefit adjustments by October of the following year. However, most seasonal workers do not get such an increase, since holiday earnings alone are not usually enough to raise their monthly average for a whole year.

For more information visit our website at www.socialsecurity.gov, or give us a call at 1-800-772-1213 and ask for a copy of the publication, “How Work Affects Your Benefits.”

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