Friday, October 8, 2010

Chris from Michigan
How do I find how much I would need to pay back to "restart" my
monthly benefit for a larger amount? Started benefits at 62 and am now 65...Is there online table available?
Thank you,

ANSWER:  Wow Chris, you'd have to withdraw your application and pay back all benefits you have received, and if anyone else received on your account, those benefits would have to be repaid too.  So just add up all those benefits, and that's what you have to pay back.

Thursday, October 7, 2010

Working and Widow's benefits

Donna from Massachussetts
I am 56, and have been widowed since I was 43. I understand I can retire at age 60 and take my husbands SS benefits as I have never remarried. Can I take his SS and still work? If so, how much can I earn? and to what age can I work? Financially I cannot afford to retire, but the extra money his SS would provide would be a great assistance.

ANSWER:  Hi Donna- When you collect a social security benefit before full retirement age (age 66), you will lose one dollar in benefits for every two dollars you earn over the earnings limit for the particular year you get benefits. This is called the “work test” or the “retirement test.” For 2010, the annual amount for those under full retirement age is $14,160. So using that as an example, if you earn $25,000, then to determine how much would be withheld from benefits, simply deduct 14,160 and divide by two. This equals 5,420. If your monthly benefit amount is $1,000 as an example, that would be $12,000 per year, but because $5,420 must be withheld, no benefits would be paid for the first five months, and then $420 would be deducted from the sixth month. You ask to what age you can work, and the answer is as long as you want and are able. Your benefits may be withheld in full or part depending on your earnings, but at age 66 your earnings no longer will affect your benefits. You will have some choices to make though when you turn 62 as to whether you want to switch to benefits on your own account. Widows have the option to collect on the deceased spouse's account at an age-reduced rate, and the switch to their own at the full rate at age 66. I discuss this in my Social Security benefits Handbook. Here's a link to Chapter Three of my online edition:

Read Section 303 for the discussion.

Divorced Wife's Benefits- some confusion

KC from Alaska:
Just discovered the Social Security AnswerBook. What a blessing! My DOB is in September 1945 and my ex-spouse was born in October 1953. Lived together from January 1980 and married from February 1992 to November 2005. His earnings as an attorney are substantial. Mine are spotty but meet the 40 quarter requirement. Divorced finally, over his fury regarding my working at all. I needed to start withdrawing my SSA benefits in October 2008 as both my finances and health have been substantially impacted by his protracted divorce litigation. After the mandatory medicare premium deduction of $110 per month, I receive about $410 per month. When can I apply for the ex-spouse benefits and how do I do that? Each visit to the Anchorage SS office produces a different answer and no useful specifics. Thank you for the service you do in the world by providing needed information to people who truly need and benefit by it.

ANSWER: Sorry to hear about your divorce problems KC. You can apply as a divorced wife when your ex-husband turns age 62. If he does not file for retirement benefits at that time, you can be entitled anyway provided you will have been divorced at least two years, which will be the situation in your case as he won't turn 62 for five years. So you will have to wait till then. His earnings will not affect your ex-wife's benefits, as per the so-called “independent entitlement” rule for divorced spouses. Here's the POMS section if you want to clarify it with the folks at SSA: RS 00202.005- and the link is:   p.s.-I hope you were able to get a good divorce settlement from him.

Wednesday, October 6, 2010

Stopping Work at 64- Effect on Benefits

Tyler from Arizona:

If I stop working completely at age 64 and earn no money until I reach my full retirement age of 66, will I receive the same benefit amount that I would receive if I worked and earned money from age 64 to age 66? Thank you for you consideration and assistance.

ANSWER: Tyler, you must have heard the old expression that there is no such thing as a free lunch.  Almost the same with social security benefits!  The benefit amounts are based on an average of your monthly earnings, 35 highest years out of 40 .  So if your last two years earnings would be higher than earlier years, your monthly benefit amount would be less. If they are the same or less than all prior years, then there would be no effect.  Note, however, that earlier years are indexed for inflation before being used in the computation, so that even though earnings in say 1980 were lower than you're making today, after the inflation adjustment, they might be higher.  I suggest you get two benefit estimates, one with your earnings for the two years and one without them.  Also, make sure you file a protective filing statement with the SS office so you don't lose out on any benefits in case you decide to make an application. I attach a link to the official SS benefit calculator site so you can put in the different scenarios.

Divorced Wife's Benefits

Justine from North Carolina:
I was divorced after 14 years of marriage (d. 1979). I started my social security at age 62. My ex-husband retired in 2008 at age 66. Are there any benefits for me now from his SS?

Yes Justine, it is possible, assuming you have not remarried, and if your primary insurance amount (your unreduced benefit) is less than one-half of your ex's primary insurance amount.  In that case, you can receive the difference as a divorced wife.

Medicaid and Married in Nevada

Sharon from West Virginia:
If a person only gets a small amount of medicaid can they go to Nevada and get married, they are unhealthy and need to keep their medicaid card? Ty

ANSWER: I hope your health improves Sharon, and your husband-to-be, too. Your question is not really about social security, but Medicaid, which is a federal/state health benefit program for the poor administered and partially funded by the several states, and partially funded by the federal government. Medicaid is not Medicare, which is federal health insurance for social security beneficiaries.  If you are getting Medicaid because you receive SSI payments, a cash program for the poor who are disabled (and aged and blind), then your new husband's income and assets will be considered and those payments could be reduced or stopped, and in many states Medicaid then stops too.  SSI is a federal welfare program, and is administered by the Social Security Administration, so you should go to the Social Security office. Make sure you have your figures with you, namely the amount of your beau's income and assets as well as yours. Because the Medicaid program is administered and partially paid for by the states, the rules can vary from state to state for that program.  You will have to check with the Social Services departments of both states.

Monday, October 4, 2010

Common Law Marriage & Disabled Adult Grandchild- Two Questions

Ronald from Texas

I have two or three items that I need answers 1)my mother wants to know if she qualifies for spouse benefits she was common law married for almost 11 years. 2)my mother is taking care of her grandaughter for almost 33 years,she is completely handicapped.Is she eligable for benefits and care benefits.

ANSWER: Ok Ronald, here you go with two answers.

1- Social Security law uses state law to determine whether a person is married. Texas does recognize such marriages. Since your mother is married for more than one year, she may be eligible.

2- Social Security provides benefits for disabled adult children on their parents' accounts in the event of a parent's entitlement to retirement or disability benefits, if if the parent dies. A grandchild can receive on the grandparents' account only if the parents are deceased or totally disabled at the time the grandparent dies or becomes eligible, and must be dependent on the grandparent. The disabled grandaughter may be eligible for SSI payments, which is a federal welfare program based on need, provided the child's income and assets are below certain levels. This program is administered by the Social Security Administration. I would suggest that your mother file an application on behalf of the grandaughter with Social Security as soon as possible.

Remarried Widow

Charmaine from South Carolina

Dear sir, i am going to try to collect on my late husband's ssi benefits. the trouble is i am 61, married, he died in'86. but a rep. from s.s. told me i should apply anyway because i was not made aware all that time i might be eligible. can you give me some advice as to if i might still be qualified? thanks, Mrs. F.

ANSWER: Well Mrs. F, if you remarried after age 60, you can be eligible on your departed husband's account for Social Security widow's benefits. If you think you may qualify, you should take the SS rep's advice and apply, and you shouldn't wait because there is no retroactivity for such an application. This means that you cannot get benefits for any month before the date of the application. But if you filed a “protective filing statement” the date you filed that will be used as the application date. I will be posting an article very soon about using Protective Filing Statements to maximize the payout of benefits. By the way, you mentioned your husband's “SSI” benefits. I assume, maybe incorrectly, that you meant SSA rather than SSI, which is a federal welfare program based on need, not SS work credits. You can't collect SSI on a SS account, it strictley is nased on your income and assets, as well as being aged, blind or totally disabled.

Divorced Fireman

Leslie from Arkansas

My father worked as a city fireman for 25+ years. He paid into a pension and did not pay into Social Security. My mother worked for 20+ years and did pay into Social Security. They were married for 20+ years and then divorced and both remarried. My mother is at retirement age but is not drawing off of what she put in, but she does draw off her present husband's account. My father is at retirement age. Is he entitled to draw off her account?

ANSWER: No, because he is married, but you gave it a nice try Leslie!