Social Security earnings limit calculation: monthly vs. yearly for 2025

Social Security applies both monthly and yearly earnings tests when you're under FRA. For 2025, the annual limit is $22,320, and they'll deduct $1 in benefits for every $2 you earn above that limit. However, there's also a monthly grace year rule that applies during the first year you claim benefits. In this case, for 2025, you can earn up to $1,860 in any month and still receive full benefits for that month regardless of your annual total. This helps people who might have substantial earnings before retirement but then start benefits mid-year. So to answer your question - they look at both! They'll check if your annual earnings exceed $22,320, but in your first year of benefits, they'll also check each month individually.

they def look at the whole yr i went over by like $900 back in 2023 and they made me pay back some of my benefits the next feb. it was a mess dealing with them!!

The earnings test is a bit more nuanced than some of the other comments suggest. Let me clarify a few points: 1. In the first year you claim benefits (2025 for you), SSA applies a monthly earnings test. This isn't just a "grace year" - it's specifically designed for people transitioning to retirement. For 2025, you can earn up to $1,860 in any month and still receive benefits for that month, regardless of your annual total. 2. After that first year, only the annual test applies (unless you reach FRA). 3. When calculating earnings, SSA only counts wages earned from employment or net earnings from self-employment. They don't count investment income, government benefits, interest, pensions, annuities, or capital gains. 4. If you do exceed the limits, SSA withholds benefits at the rate of $1 for every $2 earned above the annual limit. For your specific situation with irregular hours, if you're under FRA for all of 2025 but this is your first year receiving benefits, you could potentially earn more than $22,320 for the year but still receive benefits for months where you earned $1,860 or less.

This monthly/yearly thing confused me so much when I retired!!! I wish the SSA would explain this better on their website or send out clearer notices. I ended up having my benefits reduced because I didn't understand how it all worked, and then spent MONTHS trying to get someone on the phone to explain it to me.

Everyone here is overthinking this. Just keep your annual income under the limit and you'll be fine. SSA has bigger issues to deal with than monitoring your month-to-month earnings.

my aunt said they took like 4 months of her benefits away last year cuz she forgot about the limit and kept working too much!! be carful!!

I've been dealing with this exact situation for the past 8 months and it's been DRIVING ME CRAZY!!! The earnings limit is the most confusing thing EVER and the SSA representatives give different answers every time I call!!! I'm so frustrated I can't even tell you. I just wanted to work part-time after starting my benefits but now I'm constantly worried about going over the limit. I've been keeping a spreadsheet of every penny I earn and I still don't know if I'm doing it right!!! Does anyone know if they count your gross wages or after-tax? And do employer contributions to health insurance count toward the limit??? NOBODY AT SSA WILL GIVE ME A STRAIGHT ANSWER!!!!

Thanks everyone for the responses! This is clearer now. So for 2025 (my first year on benefits), I'll keep track of both my monthly earnings to stay under $1,860 for months I want full benefits, but also watch my annual total. And I'll definitely keep good records for when I file taxes next year so there are no surprises.