By Reg Jones
December 12th, 2012 | Uncategorized
Q. I am a firefighter working a 72-hour week. I am thinking of retirement. I have been working 25 years six months and am 50. Is there a limit on what you can make and still draw the Social Security supplement?
A. You’ll be subject to the Social Security earnings limit, but only after you reach your minimum retirement age. For you, that will be age 56.
October 17th, 2012 | Uncategorized
Q. I retired from FERS in 2007, with 22 years of service as a special agent. I receive the supplement now and have received it since 2007. I am 56. I have heard several stories about when the supplement ends, and I am trying to get the straight scoop. At what age will it end for me?
A. Assuming you don’t exceed the annual Social Security earnings limit now that you’ve reached you minimum retirement age, the special retirement supplement ends on the last day of the month in which you turn 62. If you do, the SRS will be reduced or suspended. Note: the earnings limit in 2012 is $14,640.
Q: A friend told me that her monthly Social Security benefit was reduced by $250 because of the profits made from the sale of a house that she inherited from her mother. Can this be true?
A: The Social Security earnings limit only applies to earnings from wages or self-employment, and then only for those individuals who haven’t reached full retirement age. In the ordinary course of events, income received through the sale of a home wouldn’t be considered to be earnings. However, if she reported any portion of the proceeds as earnings on her federal income tax return (because she served as a real estate agent, for example) that amount would be subject to the earnings limit.
Q: I retired at age 57 as a Civil Service Retirement System Offset employee. I’ve enjoyed a private industry position but have learned that at age 62, my CSRS annuity will be reduced. I can retire through the Social Security Administration to recoup the reduced amount, but will be subject to an earnings limit which wipes out the entire SSA pension. Am I missing something? Are offset retirees subject to the SSA earnings limits?
A: Yes, they are. The earnings test will reduce your Social Security benefit by $1 for every $2 you earn above the limit, which is $14,160 in 2010. In the year you reach full retirement age, the reduction will $1 for every $3 over a different limit, which is $37,680 in 2011. The limit no longer applies in the month in which you reach full retirement age.
Q: I will be retiring in January with 31 years of federal service. I also have more than 40 quarters to qualify for Social Security. My wife will be applying for Social Security benefits when she turns 62 this January. When we retire, will she be able to collect her full Social Security benefit, and will I be able to collect my share of Social Security under the windfall elimination provision?
A: She will be able to collect her full earned Social Security benefit. When you apply for a Social Security benefit, it will, as you pointed out, be subject to the windfall elimination provision. Further, any Social Security spousal benefit to which you may be entitled will be affected by the government pension offset provision, which probably will reduce it to zero.
Q: If I retire with 30 years of federal service under the Federal Employees Retirement System at my minimum retirement age of 56 and I go back to work outside of the federal government, will I lose my Social Security supplement?
A: If you exceed the Social Security earnings limit, your special retirement supplement will be reduced by $1 for every $2 you earn. In 2010, that limit is $14,160.
April 27th, 2010 | Uncategorized
Q: I am a dual-status Army Reserve technician about to retire, and my Federal Employees Retirement System workers and I are confused as to whether we can receive both the Social Security supplement and our Army Reserve retirement money without deductions taken from either amount. For example, I will retire at age 56 under FERS, which qualifies me for a Social Security supplement of $1,045 until age 62. I also become eligible for the Army Reserve retirement check for about $1,500 at age 60. So far, no one can tell me whether we will lose part of our our supplement; up until this point, all of our retirees have been under the Civil Service Retirement System.
A: Yes, you may receive both benefits without a reduction in either. That’s because the Social Security earnings limit, which could reduce the amount of the special retirement supplement, is based solely on earnings from wages or self-employment. All other forms of income, including annuities, aren’t counted.