Social Security and You: More SSA Blunders
I recently came across a Facebook page dedicated to Social Security Administration retirees. I decided not to join it because one of its tenets was this: "Never criticize the work being done by current SSA employees." I really don't like writing columns that are critical of my former colleagues who work in local SSA field offices or telephone centers. But doggone it! I hear from readers every week who have been misled or misinformed by agency representatives. And I would be remiss if I didn't point out the errors and set the record straight. Here are a few examples from just this week's mailbag.
Q: I will be 66 in October. I continue to work and make about $140,000 per year. I wanted to start my Social Security in October. And you told me that I could do it. You said even though I make well over the $46,920 earnings limit, that limit no longer applies when I turn 66. So I went to my local Social Security office to file, and I was told by a nice young man that I am not due any benefits this year because I make too much money. He told me that I must wait until January 2020 to file, which is what I now plan to do. When I asked to see the rules in writing, he told me they cannot share that information, but he assured me that he was right. So I'm sorry, but you are giving out incorrect information. But still, I really wish I could see something in writing.
A: Well, I'll take your word for it that the SSA rep you talked to was a "nice young man." But sadly, he was not a well-informed young man. And I will show you something in writing that will prove that I am right and he is wrong. (And, by the way, shame on him for saying he could not share the written information with you. All Social Security rules and regulations are public knowledge. In fact, they are all published on SSA's website, https://www.socialsecurity.gov.)
And those rules clearly state that earnings penalties go away the month you turn 66. Beginning Oct. 1, you could make a million dollars per day, and you would still be due Social Security benefits.
I cut and pasted a section from SSA's website that explained the rules and sent it to this reader. It was too detailed to include in this short column, but it contained the following points verbatim:
"In the year you reach your full retirement age, we deduct $1 in benefits for every $3 you earn above a limit. In 2019, the limit on your earnings is $46,920, but we only count earnings before the month you reach your full retirement age.
"Beginning with the month you reach your full retirement age, your earnings no longer reduce your benefits, no matter how much you earn."
Q: I just got a letter from Social Security telling me I was overpaid because I made too much money last year. The letter said they were going to withhold my next several Social Security checks until they get all their money back. I immediately called SSA to explain that the excess money I made last year was accumulated vacation and sick pay I received after I retired. When I asked you about this last year at the time I retired, you told me this income wouldn't count against me. Well, the SSA phone rep told me that was wrong, and that I was overpaid and that the money would be withheld from my future checks. I asked if I had any recourse, and she said no. What can I do about this?
A: Shame on that SSA phone representative. At the very least, she should have offered you the opportunity to file a written appeal of the overpayment decision.
She should have also checked the rulebook. Or she simply could have looked at the agency's fact sheet. It is called "Special Payments After Retirement," and it includes this subtitle: "Learn how special payments for work done before retirement, such as bonuses, vacation pay, and commissions, do not count toward the Social Security earnings limit."