Ask Larry

I have just reached full retirement age. I am a REALTOR and do not know if I will be earning much income this year if the markets continues to slow down. I was going to wait until at least 68 to start benefits, but am now thinking about starting and then possible suspending if I am still earning. Question: If I suspend until 70, but decide I need the SS income from a previous year, will they pay for a back year or more? And, if so, how will that payment effect by the increases I have earned by suspending.

thank you!

Hi. No. Once you apply for and voluntarily suspend your benefits, the earliest that you can reinstate them is effective with the month after the month that you notify Social Security that you wish to resume payments. You can't reinstate suspended benefits retroactively.

What you can do instead, though, is simply delay applying for benefits rather than claiming your benefits and then suspending them. If you haven't previously applied for benefits and if you're over full retirement age (FRA), you can file an application and claim benefits retroactively for up to 6 months prior to the month of your application.

However, if you do claim retroactive benefits you would lose the delayed retirement credits (DRC) that you otherwise would have earned for those months. DRCs increase your benefit rate by 2/3rds of 1% per month, so claiming 6 months of back benefits would result in a monthly benefit rate that's permanently 4% lower than the rate you'd receive if you instead chose not to be paid for those months.

It sounds like you may want to strongly consider using our software (https://maximizemysocialsecurity.com/purchase) to fully compare and analyze all of your options so that you can determine your best strategy for maximizing your benefits.

Best, Jerry

I turn 70 in July and will begin taking social security. How much income can I make before income taxes are extreme in 2023 and then 2024?

Hi. I'm sorry, but my expertise is limited to Social Security benefits so I'm not able to answer your question. For information about taxation of Social Security benefits, refer to the following Social Security website: https://www.ssa.gov/benefits/retirement/planner/taxes.html.

Best, Jerry

Do I need to file a tax return for sale of my home if social security is my only income

Hi. My expertise is limited to Social Security benefits, so I can't answer tax questions. You should probably check with the IRS or a tax expert.

Best, Jerry

I am retired from the federal government and receive a generous civil service pension. Although I worked sufficient quarters before and after my federal employment, because of “offset” I receive only a small amount of what I would ordinarily receive from social security. My wife receives a full social security benefit, am I eligible to receive benefits through her social security?

Hi. Probably not. If you receive a pension from your work for a governmental agency in the U.S., then any Social Security spousal or survivor benefits that you qualify for would almost certainly be fully or partially offset due to the Government Pension Offset (GPO) provision (https://www.ssa.gov/pubs/EN-05-10007.pdf). It sounds like GPO would cause any spousal or survivor benefits for which you'd otherwise qualify to be offset by 2/3rds of the amount of your government pension. Therefore, unless your spousal benefit rate would amount to more than 2/3rds of the amount of your government pension, your potential spousal benefit rate would almost certainly be reduced to zero.

Best, Jerry

I receive SSDI and was born in Dec of 1956. I'm getting close to full retirement age. Since I also had a student loan that was canceled as ling as I remain disabled, my question is once I hit FRA, am I deemed by SSA to be instantly not disabled anymore? Since they were the ones that notified FedLian that I was disabled inbthe first place, will they report that I maxed out and am no longer disabled?

Hi. When you reach your full retirement age (FRA), your Social Security disability (SSDI) benefits will automatically convert to regular Social Security retirement benefits. That conversion happens not because Social Security deems you to no longer be disabled, but simply because at that point it no longer matters whether you're disabled or not. SSDI benefits are calculated at a rate of 100% of a person's primary insurance amount (PIA), as are Social Security retirement benefits if a person starts drawing them at FRA. Therefore, once you reach FRA it is irrelevant whether or not you're disabled as far as Social Security is concerned.

My expertise is limited to Social Security benefits, so I can't tell you what if any impact the conversion of your SSDI benefits to retirement benefits might have on your student loan. You may want to check with the agency responsible for the loan.

Best, Jerry

Hi my son approved for ssi he gat pay back money he's 4yr old in what's can spend he's money he need tv and I pad new bed he need toys he need diaper every day or can Isave he's money for he's future in the bank please I need some help let me know thanks

Hi. If you're the representative payee for your son, you must use his benefits for his current needs or save the benefits for his future needs. Current needs include thing such as clothing, food, and shelter. For example your son's benefits can be used to pay for his share of the rent or mortgage as well as the cost of his food. Items such as diapers would definitely be a proper use of benefits if your son requires diapers, but I think that Social Security would likely view things like a TV or iPad as luxury items. Therefore, you should check with Social Security before making any questionable purchases using your son's benefits.

Representative payees are required to file annual reports with Social Security explaining how the beneficiary's benefits were spent or saved, so you'll want to keep track of how you spend your son's benefits. I would also suggest reading the following Social Security publication that explains your responsibilities when acting as a representative payee: https://www.ssa.gov/pubs/EN-05-10076.pdf.

Best, Jerry

Will my ss account get the 8.7% cola raise. If I am not drawing ss now, born December 1961. Full retirement age 67

Hi. No. Only people who were born on or before January 1 1961 will be credited with the 2023 8.7% cost of living (COLA) increase when calculating their Social Security retirement benefit rate.

Best, Jerry

Hi my wife born 01/03/1956 took benefits at 64. I then took spousal benefits. I plan on taking my benefits this year at age 70. Question will my wife's benefit rise or stay the same? Thank you so much.

Hi. Your wife's total benefit amount will only increase when you claim your own benefits if she then qualifies for an excess spousal benefit from your account. In order to qualify for an excess spousal benefit, your primary insurance amount (PIA) would have to be more than twice as much as your wife's PIA. A person's PIA is equal to their Social Security retirement benefit rate if they start drawing their benefits at full retirement age (FRA).

Some people think that auxiliary benefits paid to a spouse or child cause the benefit rate of the worker on whose record they collect to be reduced. That's not true. Auxiliary benefits are paid in addition to the worker's benefit, they don't take away from the worker's benefit. Therefore, when you switch from spousal benefits to your own benefits it won't cause your wife's own benefit rate to increase.

Best, Jerry

Hello, my husband passed while waiting on the heart transplant list. He had SSDI so I should be able to receive survivors benefits for my Autistic son who also receives SSI. But is it beneficial if he applies for his own SSDI as well? As my husband is the one who handled this information I am in over my head and hoping I can find some answers. Thank you for your time.

Hi. I'm sorry for your loss. As long as your son is either under age 18 or disabled from a condition that started prior to age 22, he should be able to qualify for survivor benefits. And, depending on your age, you may also be able to qualify for survivor benefits either as a widow or as a mother with a child in care. Social Security also pays a one-time $255 death benefit to surviving spouses who were living together with their deceased spouse (https://www.ssa.gov/benefits/survivors/.)

If your son was already receiving Social Security child benefits based on your husband's Social Security disability (SSDI) entitlement, then his child benefits should automatically convert to survivor benefits. Otherwise, he'll need to file an application with Social Security. And, unless you've previously applied for child in care spousal benefits you'd need to file an application if you want to claim survivor benefits. You can apply for benefits or make an appointment to do so by calling Social Security at 800-772-1213 or by visiting a Social Security office.

Best, Jerry

Hello,
I will be 67 and 7 months in a few days. I am single, never married, still working, no dependents. I am on Medicare, but have not yet filed for Social Security.
I plan to keep working until at least 70.
I understand that I can claim, suspend, then restart benefits. If I do that now, I think I can collect 6 months in a lump sum, is that right? If at all possible, I would like to avoid collecting a check for even one month. I'm interested in the lump sum alone.
From reading, it seems like I will end up sacrificing about 4% of my benefit for the rest of my life is that right?
If I start the process now, in January, is the lump sum calculated at the newly increased rate or does it go by what it had been before the new cost of living adjustment?
When I file, do I suspend my benefits the same day or do I wait a few days?
Getting the steps exactly right is my primary concern.
Thank you!

Hi. You can claim retroactive benefits for up to 6 months prior to the month of your application, but you can't then suspend them until the month after the month you make the request for suspension. So, for example, if you file an application in January 2023 you can claim benefits starting as early as July 2022. You could also request to voluntarily suspend your benefits by adding a remark to that effect on your application, but the earliest month that your benefits could then be suspended would be February 2023.

The only way that you could apply for benefits and collect exactly 6 months of benefits would be to only claim 5 months of retroactive benefits and then request suspension of your benefits effective with the month after the month of your application. You'd then be paid for the 5 retroactive months plus your application month. And, yes, if you collect 6 months of benefits you'll lose the 4% benefit increase that you could have earned from delayed retirement credits (DRC) for those months.

The benefit rate that you'd be paid per month for any retroactive months would be the rate in effect for those months. Therefore, if you file now and claim retroactive benefits, the 2023 8.7% cost of living (COLA) increase won't be added to benefits payable for months prior to December 2022.

Furthermore, if you start drawing benefits between FRA and age 70, Social Security initially only gives you credit for any delayed retirement credits (DRC) that you earned through December of the year prior to your initial month of benefit entitlement. Any DRCs earned in the your initial year of entitlement are subsequently credited effective with your payment for January of the year after the year you elected to start your benefits. In other words, if you claim benefits retroactive to 2022, your benefit rate for months in 2022 will only include the DRCs you earned through December 2021. The DRCs you accrued for months in 2022 prior to your initial month of entitlement couldn't be credited to your benefit rate until your benefit payment due for January 2023.

Before filing for benefits, you should strongly consider using our software (https://maximizemysocialsecurity.com/purchase) to fully compare and analyze all of your options so that you can be sure to choose the best possible strategy for maximizing your benefits.

Best, Jerry