Social Security Earnings Test: 3 Income Sources Affecting Benefits

Описание: Social Security Earnings Test: 3 Income Sources Affecting Benefits

If you’re considering claiming Social Security early, understanding the Social Security earnings test is critical.

In this video, we discuss the earnings test, who it applies to, and what income actually counts toward the limit.

The Social Security Administration applies the earnings test to earned income (W-2 wages and net self-employment income subject to FICA taxes).

What about 401(k) distributions, IRA withdrawals, Roth IRA income, pension payments, annuities, capital gains, dividends, interest, rental income, or required minimum distributions (RMDs)?

If you’re weighing when to claim benefits at 62, 66, or 67, this overview will help you better understand how earned income can impact your Social Security benefits. And how different income sources are treated under current rules.



Key Takeaways:

1. The Social Security earnings test applies only if you are taking benefits before full retirement age.

2. Only earned income counts.

3. 401(k) and IRA distributions do not count toward the earnings test.

4. Pension income, annuities, capital gains, dividends, and most rental income are excluded.

5. Proper income planning is essential when claiming Social Security early.


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