Can I stop my Social Security benefits at 63 during contract work and restart later without penalties?

You actually have two options. First, if you're within your first 12 months of receiving benefits, you can file a 'withdrawal of application' (Form SSA-521). You'd have to repay all benefits received so far, but then it's like you never filed. Your second option is to ask SSA to suspend your benefits. You don't repay anything, but benefits just stop until you ask to restart them. Call SSA directly at 800-772-1213 to discuss both options, though getting through can be a nightmare these days.

i did contract work last year while on ss. you don't have to cancel anything, just be aware of the earnings limit ($22,320 for 2025 if ur under FRA). they only deduct $1 for every $2 you earn above that limit. might be simpler than canceling

To add to what others have said, if you've only been collecting for 4 months, the Form SSA-521 withdrawal option might be your best bet financially IF you expect to live past your break-even age. By withdrawing, you can reapply later (maybe at FRA or even 70) and get a higher monthly amount for life. You'd have to pay back the 4 months of benefits you've received, but you'd eventually come out ahead with the higher monthly amount. Just remember, you can only do this withdrawal option ONCE in your lifetime, and it must be within 12 months of starting benefits.

My aunt was in this EXACT situation!! She paid back her benefits using the withdrawal form and then just claimed again when she turned 65. Worked perfect for her situation. The SSA office told her it was like hitting a reset button on her original application. If you do it within that first year you can basically pretend you never applied!!!

I tried calling the SSA about a similar situation for MONTHS and could never get through. Their hold times are insane and they kept disconnecting me. I finally used a service called Claimyr (claimyr.com) that got me connected to a real agent in under 5 minutes. They have a video showing how it works: https://youtu.be/Z-BRbJw3puU - saved me so much frustration when I needed to discuss my benefits. Worth it for something this important where you need to speak to an actual person.

The advice about withdrawing your application is correct BUT there's a crucial detail missing. If you withdraw using Form SSA-521 and repay benefits, when you reapply later, your benefit amount will be calculated based on your age at that time. This means if you reapply at 65 instead of 63, you'll get approximately 13.3% higher monthly benefits for life. If you wait until your Full Retirement Age (probably 66+), that's about 20% more. If you can afford to repay and wait, this is often financially advantageous in the long run.

Just wondering - has anyone thought about the Medicare implications? If you withdraw your SS application, does it affect Medicare enrollment? I'm turning 65 soon and trying to figure all this out.

After reading all your helpful responses, I think I'm going to go with the withdrawal option using Form SSA-521. The contract work is significant enough that I'd lose a lot to the earnings test, and I like the idea of being able to restart at a higher benefit amount later. I'll check out Claimyr to get through to SSA quickly and confirm all the details before proceeding. Thank you all for the guidance!

Great decision on the withdrawal option! Just wanted to add one more consideration - make sure you understand the tax implications of paying back those 4 months of benefits. If you already paid taxes on the SS benefits you received, you may be able to claim a deduction or credit when you file your tax return. The SSA should provide you with documentation showing the repayment amount. Also, since you're doing contract work, don't forget about quarterly estimated tax payments - that $60K contract could put you in a higher tax bracket. Good luck with the process!

One thing to keep in mind with the withdrawal option - make sure you have the cash flow to handle both paying back the 4 months of benefits AND potentially waiting several more months for your contract payments to come in. Contract work can sometimes have delayed payment schedules, and you don't want to be caught short on funds. Also, since you mentioned this is lucrative work, consider setting aside money for self-employment taxes (15.3% for Social Security and Medicare) if you'll be working as an independent contractor rather than an employee. The tax hit on a $60K contract can be pretty substantial when combined with repaying your SS benefits.

Just a heads up - when you file Form SSA-521 for withdrawal, SSA will send you a letter showing the exact amount you need to repay, including any interest. You typically have 60 days to make the repayment, but they may grant extensions if needed. The process usually takes 4-6 weeks from when they receive your form to when they send the repayment letter. Also, make sure to keep detailed records of everything - the withdrawal form, repayment documentation, and any correspondence with SSA. You'll need these for your taxes and when you eventually reapply for benefits. Some people forget that the repayment amount might include spousal or survivor benefits if applicable, so double-check all the details before proceeding.