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From SS website: If you are under full retirement age for the entire year, we deduct $1 from your benefit payments for every $2 you earn above the annual limit. For 2020, that limit is $18,240.

Is this calculated on an individual basis if one is married and both are getting SS early and making money?
In other words, what if the married couple (filing joint) COMBINED make more than $18240?

Thanks,
RB
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From SS website: If you are under full retirement age for the entire year, we deduct $1 from your benefit payments for every $2 you earn above the annual limit. For 2020, that limit is $18,240.

Is this calculated on an individual basis if one is married and both are getting SS early and making money?
In other words, what if the married couple (filing joint) COMBINED make more than $18240?


Each person is considered separately. The reduction is based on compensation income which is almost always separate (ignoring community property states).

Ira
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From SS website: If you are under full retirement age for the entire year, we deduct $1 from your benefit payments for every $2 you earn above the annual limit. For 2020, that limit is $18,240.

There is a special monthly rule that applies to the year in which you claim Social Security benefits. In the month that your benefit starts, $1 is deducted from your benefit payment for every $2 earned above $1,520/month. This rule only applies to the calendar year in which you initially claimed Social Security benefits.

The earning limit increases to $48,600 in the calendar year that you reach Normal Retirement Age (NRA). You lose $1 in benefit for every $3 over the earnings limit. There is also a special rule for claiming benefits prior to your NRA. You lose $1 in benefits for every $3 earned above $4,050/month.

Social Security can offer to set the date of your claim up to 6 months earlier. Unless you are really desperate for money, don't accept the offer. It permanently reduces your benefit and can trigger the monthly caps on earnings.
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Social Security can offer to set the date of your claim up to 6 months earlier. Unless you are really desperate for money, don't accept the offer. It permanently reduces your benefit and can trigger the monthly caps on earnings.

An option is to apply and immediately suspend. It no longer works for spousal benefits but gives more options if something serious happens before you start drawing benefits.
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Thanks Ira. Although I'm in California, a community property state. So then what?
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Thanks Ira. Although I'm in California, a community property state. So then what?

I don't know. I only prepare two tax returns for clients living in community property states and I haven't had to face that issue.

Ira
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