a different SS question

[gypsie]

So, my step dad became eligible for Social Security this past OCT 07. Throughout 2007 he had a fulltime job. As soon as he became eligible for SS, he turned in his 2 week notice.

Now, he has received 2 SS checks. Last week he gets a letter from the SS administration stating he made too much money in 2007 to draw his SS and now they want the money back and he has to re-pay it!!!

I don't understand why any time prior to his becoming eligible would matter.

Anyone heard of this?

[DHK]

What is your dad's age?

[gypsie]

62

[DHK]

http://www.socialsecurity.gov/retire2/whileworking.htm

You can work while you receive Social Security retirement (or survivors) benefits. When you do, it could mean a higher benefit for you in the future. Higher benefits can be important to you later in life and increase the future benefit amounts your family and your survivors could receive.

While you are working, your earnings will reduce your benefit amount only until you reach your full retirement age.

We use a formula to determine how much your benefit must be reduced:

• If you are under full retirement age for the entire year, we deduct $1 from your benefit payments for every $2 you earn above the annual limit.
  For 2007 that limit is $12,960. In 2008 that limit will be $13,560.
  
• In the year you reach full retirement age, we deduct $1 in benefits for every $3 you earn above a different limit, but we only count earnings before the month you reach your full retirement age.
  If you will reach full retirement age in 2007, the limit on your earnings for the months before full retirement age is $34,440.
  (If you were born in 1942, your full retirement age is 65 years and 10 months.)
  If you will reach full retirement age in 2008, the limit on your earnings for the months before full retirement age is $36,120.
  (If you were born in 1943, your full retirement age is 66 years.)
  
• Starting with the month you reach full retirement age, you can get your benefits with no limit on your earnings.

If you are not already receiving benefits, be sure to contact us at the beginning of the year you reach full retirement age. Even if you are still working, you may be able to receive some or all of your benefits for the months before you reach full retirement age.

Keep in mind that this is assuming that you are retired for the ENTIRE YEAR.

Based on what you've asked, your Dad retired during 2007. Assuming that he is under his full retirement age when he retired, there is a stiff penalty for earned income while receiving benefits. (That's where bullet point #1 comes in.)

He may have actually quit, but he was probably STILL RECEIVING INCOME - even if it was only for another month.

Now, that $12,960 is for the YEAR, or $1,080 per MONTH since entering retirement.

If he has had any income during retirement from his job that exceeded $1,080 in any month since retiring, then that is why he will be penalized.

Hope this helps!

[gypsie]

Yes, that helps alot.

I'm calling him now