Self-employment income reporting with Social Security at 62 - staying under earnings limit?

Yes, SSA looks at your net earnings from self-employment, not your gross receipts. You'll need to complete Schedule SE with your tax return, and that's what SSA will use to determine if you exceeded the earnings limit. For 2025, if you're under FRA the whole year, you'll lose $1 in benefits for every $2 you earn above the limit. This earnings test is based on annual earnings, not monthly, even though benefits are paid monthly. If you anticipate getting close to the limit, you can voluntarily ask SSA to withhold some benefits in advance to avoid an overpayment. You can do this by filing a report of estimated earnings.

I went thru this last yr. They go by whats on ur tax return at the end of the yr. Its the net profit that counts (after expenses). If u tell them at the START of yr that u expect to make $X and it ends up being more, they'll make u pay back some benefits. If u end up making less they owe u. Its a pain!!

Self-employment income is a bit complex with Social Security's earnings limit, but here's how it works: 1. SSA counts NET earnings (after legitimate business expenses) toward the earnings limit 2. You report estimated earnings when you initially apply for benefits 3. You should proactively contact SSA if your income projection changes significantly 4. The final reconciliation happens after you file your tax return 5. For self-employment, they also look at "substantial services" - if you work over 45 hours/month in your business, they may consider that exceeding the limit regardless of earnings Keep detailed records of both income and expenses. Consider setting up a separate business bank account if you don't already have one. And remember to track hours worked each month - this is especially important for professionals like therapists where your time directly relates to your services.

When I retired at 63, I got SO frustrated trying to reach SSA to ask these exact questions. Kept getting disconnected after waiting 2+ hours. Finally used a service called Claimyr (claimyr.com) that got me connected to a real person in about 15 minutes. They have a video showing how it works: https://youtu.be/Z-BRbJw3puU The agent I spoke with explained that for self-employment, you report your expected net earnings when you apply. Then update them if things change significantly. They'll adjust your benefits throughout the year based on estimates, and then do a final accounting after your tax return is filed. My CPA helped me set up quarterly estimated net profit calculations to stay on track. Definitely worth paying a professional to help with this!

My sister is a therapist and she just retired last year and started SS. She said it was a nightmare figuring out the income stuff. She ended up just limiting her clients to stay WELL UNDER the limit because she was so worried about going over. Better safe than sorry I guess.

I'm so confused about all this!! I was planning to retire from nursing next year at 62 and start a little health coaching business on the side. Now I'm terrified I'll mess up my SS checks. When you file taxes as self-employed, does that automatically connect to Social Security somehow? Or do you have to separately report to them? What forms do you use? Will they tell me if I'm getting close to the limit or just suddenly start taking money back??

OP I'm a retired accountant and here's what I tell my clients in your situation: the worst case scenario is that you earn too much and have to pay back some benefits. But that's not a disaster! You're not going to jail or losing future benefits. It's just a financial adjustment. My suggestion: create a spreadsheet to track your monthly income and expenses. Make conservative estimates (higher for income, lower for expenses) and set your practice limits to stay about 15% BELOW the annual limit. This gives you a safety buffer. Also important - SSA counts EARNED income toward the limit. If you have investments, rental property, etc. generating passive income, that doesn't count toward the earnings limit.

DONT FORGET the limit goes way up in the year u reach full retirement age and then disappears completely! My friend worked part time staying under the limit for 3 yrs then when he hit full retirement age he went back to working normal hours with no penalty.

One practical tip from my experience - I found it helpful to do a mid-year calculation after my Q2 estimated tax payment. This gives you a chance to adjust your work schedule for the second half of the year if you're trending too high or too low relative to the earnings limit. Also, remember that SSA counts income when it's earned, not when it's paid. So if you do therapy work in December but don't get the insurance payment until January, that still counts for the December year's earnings. This gets especially tricky with self-employment.

Thank you all for the incredibly helpful advice! I feel much more prepared now. I'll plan to: 1. Talk to my CPA about quarterly tracking 2. Create a spreadsheet with a 15% buffer below the limit 3. Track both service dates and payment dates 4. Report estimated earnings when I initially apply 5. Use Claimyr if I need to actually speak with someone at SSA One last question - does anyone know if there's a specific form or process for updating SSA if my earnings projection changes during the year?