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Social Security Earnings Test Limits Increased

If you receive Social Security benefits, are still working and have not reached full retirement age, you’ll get a raise this year. The federal government approved a cost of living increase on taxable maximum earnings. This means you can earn more befo

The federal government determines how much you receive using the Social Security retirement earnings test:

• If you reach full retirement age after 2017, you can make $16,920 – a 7.6 percent increase (from $15,720 in 2016) before Social Security will withhold benefit dollars. After you earn $16,920, Social Security will withhold $1 in benefits for every $2 of earnings.
• If you reach full retirement age during 2017, the exempt amount is $44,880 – an increase of 7.2 percent (from $41,880 in 2016). This higher exempt amount applies only to earnings made in months prior to the month you reach full retirement age. $1 in benefits will be withheld for every $3 of earnings in excess of $44,880.
• If you have already attained full retirement (you’re at least 66 years old), there is no earnings test and you can collect your full Social Security benefit.

As a practical matter, if you earn more than the earnings test allows during 2017, your entire Social Security benefit can be wiped out. For example, say your benefit is $1200 per month and you won’t be older than 66 in 2017; if you earn $3810 per month, your entire benefit will be withheld. Of course the earnings test does not apply if you’re already fully retired (at least 66 years old).

Visit www.ssa.gov/oact/ProgData/nra.html to learn more.

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