Social Security earnings limit confusion - annual vs monthly limits when retiring at 65 in 2026

Yes, that's basically correct. The SSA applies two different earnings tests depending on your situation: 1) The annual earnings test - applies to most people 2) The monthly earnings test - only applies in your first year of retirement Since your wife is starting benefits on January 1, 2026, the annual earnings test would apply for the full year. For 2025, the limit is $23,400 for someone under FRA for the whole year (and will likely increase for 2026). If she exceeds the annual limit, SSA will withhold $1 in benefits for every $2 she earns above the limit. But they don't necessarily switch to the monthly test as you described - that's only if you retire mid-year. She should definitely track her earnings carefully and plan her work schedule to stay under the annual limit if possible.

The SSA rep gave you WRONG information!!! I went through this EXACT situation with my husband last year. When you start benefits on January 1st, ONLY the annual test applies - period. There is NO "switching" to a monthly test if you exceed the annual limit!!! The monthly earnings test ONLY applies in the calendar year when you first retire mid-year. Since your wife is starting on Jan 1, 2026, only the annual limit matters. Trust me, I learned this the hard way. Call back and speak to a different rep!!

my father in law had this same issue!! he went over by like $600 and they took away THREE MONTHS of benefits!! totally unfair system if u ask me. make sure she watches those earnings like a hawk

It sounds like there's some confusion here, both from the SSA rep and potentially in your understanding. For someone starting benefits on January 1, 2026: - Annual earnings test applies for all of 2026 - Monthly test does NOT come into play at any point that year - For 2026, she can earn up to the annual limit (probably around $24,500-25,000) - If she goes over, they withhold $1 for every $2 over the limit I suspect what the rep might have been trying to explain is that they don't just reduce your annual benefit by a percentage - they actually withhold entire monthly payments until they've covered the amount that needs to be withheld. This often confuses people.

Good luck getting clear answers from SS! I spent 3 weeks trying to reach someone about earnings limits. Kept getting disconnected or waiting 2+ hours only to be transferred and disconnected again. Finally used that Claimyr service (claimyr.com) someone on this forum recommended. They got me connected to an actual SSA agent in 20 minutes! The video demo showed exactly how it works: https://youtu.be/Z-BRbJw3puU. Total lifesaver when you need to clarify complicated rules like this.

To summarize the correct information for everyone's benefit: 1) For someone starting benefits on January 1st: ONLY the annual earnings test applies for that entire year. 2) For 2025, the earnings limit for someone under FRA the whole year is $23,400 (will likely increase for 2026). 3) If earnings exceed the annual limit, SSA withholds $1 in benefits for every $2 earned over the limit. 4) SSA typically withholds full monthly payments, not partial ones, until they've withheld the required amount. 5) The monthly earnings test only applies in the calendar year a person retires mid-year. The OP's wife should carefully track her earnings throughout 2026 and stop working once she approaches the annual limit to avoid benefit reductions.

One thing I haven't seen mentioned yet that might be relevant to your wife's situation: the earnings limit increases substantially in the year you reach full retirement age, and only earnings before the month you reach FRA count. For example, in 2025: - If you're under FRA the whole year: $23,400 annual limit - In the year you reach FRA: $62,760 annual limit, but only counting earnings before the month you reach FRA - Month you reach FRA and beyond: No earnings limit at all So depending on when your wife reaches FRA, this could significantly impact her planning. If she turns 67 (her FRA) in 2028, she'll have a much higher limit that year and only earnings from January through the month before her birthday would count.

Also remember that any benefits withheld due to the earnings test aren't lost forever! When your wife reaches FRA, her benefit amount will be recalculated to give credit for months when benefits were withheld. Most people don't realize this part!

Just want to add one more important point that could affect your wife's situation: make sure she understands what counts as "earnings" for the earnings test. Only wages from employment and net self-employment income count - things like pensions, 401k withdrawals, investment income, rental income, etc. don't count toward the limit. Since you mentioned she does seasonal work, if she's an employee (gets a W-2), all those wages count. But if she's self-employed or an independent contractor, only her net earnings after business expenses would count toward the limit. This distinction could make a big difference in her planning, especially if she has any business expenses related to her seasonal work. Also, the earnings are counted when earned, not when paid. So if she earns money in December 2026 but doesn't get paid until January 2027, it still counts toward her 2026 earnings limit.

For the specific SSA publication, you'll want to look at Publication No. 05-10069 "How Work Affects Your Benefits" - this is the official guide that covers all the earnings limit rules. You can find it on the SSA website at ssa.gov/pubs/ or request a physical copy. Also, when you call back to get clarification, ask them to reference the specific sections in the Program Operations Manual System (POMS) that apply to your wife's situation. The relevant sections are RS 02501.001 for annual earnings test and RS 02501.020 for monthly earnings test. Having these reference numbers will help ensure you're getting consistent information from different reps. One more tip: if you create a my Social Security account online, you can send secure messages to SSA with your questions and get written responses back. This creates a paper trail and often results in more thoughtful, accurate answers since the reps have time to research before responding.

I've been reading through this entire discussion and it's been incredibly enlightening! As someone who's also approaching Social Security decisions, I wanted to thank everyone for the detailed explanations and practical advice. What strikes me most is how much misinformation there seems to be, even from SSA reps themselves. The fact that the original poster got told about "switching" between annual and monthly tests when starting benefits on January 1st is concerning - that's just not how the system works. For anyone else following this thread, I think the key takeaways are: 1. Starting benefits January 1st = annual earnings test only for that entire year 2. Monthly test only applies when retiring mid-year in your first year of benefits 3. Get everything in writing and ask for technical experts when calling SSA 4. The timing of when work is performed (not paid) matters for earnings calculations 5. Track everything carefully and consider strategic timing of seasonal work The advice about Publication No. 05-10069 and those POMS reference numbers is gold - having those specific citations should help avoid the confusion that seems to plague regular SSA customer service calls. Lucas, I hope you and your wife are able to get this sorted out with confidence now. With all the strategies discussed here for timing her seasonal work and staying under the annual limit, it sounds like she should be able to make this work well!