Issue 1.12
RETIREMENT
Question:
I work in retirement. How much can I earn and still collect full Social Security retirement benefits?
Answer:
Social Security uses the formulas below, depending on your age, to determine how much you can earn before we must reduce your benefit:
- If you are younger than full retirement age: $1 in benefits will be deducted for each $2 you earn above the annual limit. For 2011, that limit is $14,160.
- In the year you reach your full retirement age: $1 in benefits will be deducted for each $3 you earn above a different limit, but we count only earnings before the month you reach full retirement age. For 2011, this limit is $37,680.
- Starting with the month you reach full retirement age: you will get your benefits with no limit on your earnings.
Find out your full retirement age at www.socialsecurity.gov/pubs/ageincrease.htm.
Question:
Do I have to pay income tax on my Social Security benefits?
Answer:
It depends. Fewer than one-third of our current beneficiaries pay income taxes on their benefits. You will have to pay Federal income taxes on your benefits if you file an individual Federal income tax return and your total income is more than $25,000. If you file a joint return, you will have to pay income taxes if you and your spouse have total income of more than $32,000.
For more information, call the Internal Revenue Service (IRS) toll-free at 1-800-829-3676 and ask for IRS Publication 915, Social Security and Equivalent Railroad Retirement Benefits, www.irs.gov/publications/p915/index.html. People who are deaf or hard of hearing may call the IRS toll-free number, 1-800-829-4059.
SUPPLEMENTAL SECURITY INCOME
Question:
How much will I receive if I qualify for Supplemental Security Income (SSI) benefits?
Answer:
The amount of your SSI benefit depends on where you live and how much income you have. The maximum SSI payment varies nationwide. The maximum Federal SSI payment for an eligible individual is $674 a month and $1,011 a month for an eligible couple. However, many States add money to the basic payment. For more information, go to www.socialsecurity.gov/ssi.
Question:
My child is disabled. Can she qualify for Supplemental Security Income?
Answer:
SSI makes monthly payments to people with limited income and resources who are 65 or older, or blind, or disabled. Your child younger than age 18 can qualify if he or she meets Social Security’s definition of disability for children, and if his or her income and resources fall within the eligibility limits. We also consider the income and resources of family members living in the child’s household. For more information, call 1-800-772-1213 (TTY 1-800-325-0778) or visit www.socialsecurity.gov/pubs/10026.html.
MEDICARE
Question:
What are the four parts of Medicare?
Answer:
There are four parts to Medicare.
- Hospital insurance (Part A) helps pay hospital bills and some follow-up care. The taxes you paid while you were working financed this coverage, so, for most people, it’s premium free.
- Medical insurance (Part B) helps pay doctors’ bills and other services. You must pay a monthly premium for Medicare Part B and you have the option to refuse this coverage.
- Medicare Advantage (Part C) plans generally cover many of the same benefits a Medigap policy would cover, such as extra days in the hospital after you have used the number of days Medicare covers. People with Medicare Parts A and B can choose to receive all of their health care services through one of these provider organizations under Part C. There might be additional premiums required for some plans; and
- Prescription drug coverage (Part D) helps pay for medications doctors prescribe for treatment. Anyone who has Medicare hospital insurance (Part A), medical insurance (Part B), or a Medicare Advantage plan (Part C) is eligible for prescription drug coverage (Part D). Joining a Medicare prescription drug plan is voluntary and you pay an additional monthly premium for the coverage.