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Earnings test - reduction in benefits

Earnings test - reduction in benefits

March 8, 2011 by admin

Depending on how much you work, if you start receiving retirement benefits your benefits may be reduced.

If you are under full retirement age for the entire year, SSA will deduct $1 from your benefit payments for every $2 you earn above the annual limit. For 2011, that limit is $14,160.

Below is a link to a calculator which will allow you to estimate the effect of this rule.

Here is a sample run:

Birth date: 6/2/1946
Estimated earnings in 2011: $30,000.00
Monthly benefit in 2011: $1,700.00
First entitled in 2011? No

Results :

Your reduction in annual benefits is $7,920 based on the $14,160 annual exempt amount for 2011.

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