Social Security earnings limit confusion - collecting SS at 63 with fluctuating 1099 income

i thght it was just yearly total??? I'm 62 n collecting too but I have W2 job not 1099. My understanding is they just look at the TOTAL for the year not month by month???

The monthly earnings test ONLY applies during the first calendar year you receive benefits. After that, SSA only applies the annual earnings test. So if you started collecting benefits anytime in 2025, the monthly limit ($1,950) applies throughout 2025. If you exceed the limit in any month, you won't receive benefits for that specific month. But you'll still receive benefits for months where you stay under it. Starting January 2026, only the annual limit matters. If your total income stays under $23,400 for the year, you keep all your benefits regardless of monthly fluctuations.

WATCH OUT! The SSA won't automatically stop and restart your payments each month based on your earnings. YOU are responsible for reporting income changes, and they'll usually find out if you don't. I learned the hard way and got hit with a $4,700 overpayment notice because I didn't report properly. The system is DESIGNED to trip you up!!

my neighbor had this exact same issue last year with her craft business. monthly income all over the place. she just called ss at beginning of any month she thought would be high and told them to hold her check for that month. avoided all the overpayment headaches

I spent THREE DAYS trying to get through to Social Security about this exact issue last month. Kept getting disconnected or waiting for hours. Finally tried this service called Claimyr (claimyr.com) that got me connected to an agent in 20 minutes. They have a video showing how it works: https://youtu.be/Z-BRbJw3puU The agent explained that during my first year on benefits, I need to notify them of any month I'll exceed the limit, and they'll withhold benefits just for that month. After the first year, only the annual limit matters.

Just want to point out that once you reach full retirement age (66 and 8 months for people born in 1962), these earnings limits completely disappear! You can earn unlimited income with no reduction in benefits. Something to look forward to!

To summarize for clarity: 1. In your first year receiving benefits (2025), the monthly earnings test applies 2. If you earn over $1,950 (2025 limit) in any month, you won't receive benefits for that specific month only 3. You must proactively report months where you'll exceed the limit 4. For months you earn under $1,950, you receive full benefits 5. Starting in 2026, only the annual limit ($23,400) matters, regardless of monthly fluctuations 6. At Full Retirement Age (66+8mo for you), all earnings limits disappear I recommend keeping detailed income records and contacting SSA at the beginning of any month you expect to exceed the limit.

One more important point: If you do end up with an overpayment because you exceeded the earnings limit, you have options. You can request a waiver if it wasn't your fault and repayment would cause financial hardship, or set up a reasonable payment plan. Don't panic if you get an overpayment notice.

I'm still confused about how they even know what we earn month to month on 1099 work. do they just find out at tax time the next year??

As someone who went through this exact situation two years ago, I can confirm what others have said - the monthly test only applies in your first year of benefits. The key is being proactive about reporting. I kept a simple spreadsheet tracking my monthly earnings projections and would call SSA by the 15th of any month I expected to exceed the limit. Yes, getting through is a pain, but it's way better than dealing with overpayment notices later. One tip: SSA considers when you EARN the income, not when you receive payment. So if you close a real estate deal in March but don't get paid until April, it counts toward March's earnings limit. This tripped me up initially. Also, keep detailed records of all your transactions and communications with SSA. You'll need them for tax time and potentially for any disputes. The system is confusing but manageable once you understand the rules.

This thread has been incredibly helpful! I'm in a similar situation - started collecting at 62 last year and work freelance graphic design with very unpredictable income. One thing I learned the hard way: SSA also counts estimated quarterly tax payments as part of determining your monthly earnings for self-employment income. So if you pay estimated taxes in January for Q4 of the previous year, they might allocate some of that income to January even though you actually earned it months earlier. I'd recommend setting up a my Social Security account online if you haven't already. You can report work activity changes there without having to call, and it keeps a record of what you've reported. It's been a lifesaver for managing my variable income reporting. Also, real estate commissions can be tricky because of when deals close vs when you actually did the work. I'd suggest tracking both the date you earned the commission (contract signing/deal completion) AND when you receive payment, just to be safe when reporting to SSA.