Social Security earnings limit confusion - when does SS reduce benefits if I exceed the limit?

They won't know until you file taxes for 2025 which isn't until 2026... so you could potentially get paid the full amount all year then have to pay back a bunch or have future benefits reduced.

When I went through this last year, here's what happened: SSA sends out a letter early in the year asking about your expected earnings for the current year. You have to estimate your earnings and send it back. They will adjust your benefits based on your estimate. If you go over your estimate, they won't know until you file taxes. Then they'll send you an overpayment notice. If you earn less than your estimate, they'll pay you the difference. For the record, I used Claimyr (claimyr.com) to actually talk to someone at SSA about this exact situation - I had questions their online form didn't answer. Was able to get through in 15 minutes instead of waiting on hold for hours. They have a video showing how it works: https://youtu.be/Z-BRbJw3puU

Let me clarify how this actually works, since there seems to be some confusion: 1. SSA applies the earnings test monthly in the first year you receive benefits (2022 in your case) and annually thereafter 2. For 2024-2025, they'll use the annual limit ($22,320 for 2024, likely around $23,000 for 2025) 3. They withhold $1 in benefits for every $2 you earn above the limit 4. For proactive reporting: you should complete form SSA-131 (Work Activity Report) when you start working 5. Many beneficiaries don't realize that SSA eventually receives wage data from the IRS after you file taxes, which triggers automated earnings reviews 6. If you exceed the limit, SSA will send a notice explaining the overpayment and options (repayment plan, waiver request, or appeal) Most importantly: going over the limit isn't necessarily bad! SSA will recalculate your benefit amount when you reach FRA to credit back the withheld benefits.

BEWARE!!! SSA's systems are TERRIBLE at tracking this properly!!!! I went through HELL last year when I accidentally went over by just $870! They suddenly stopped ALL my payments for THREE MONTHS without warning! When I called they kept giving different explanations. One rep said they'd resume after withholding for 2 months, another said 3 months, a third said I'd get a partial payment!!! NOBODY KNEW! I had to borrow money from my daughter to pay rent!!! My advice: DOCUMENT EVERYTHING and keep WELL under the limit!!!!!

There are several important technical points to understand about the earnings limit: 1. The annual earnings limit for 2024 is $22,320 if you're under FRA the entire year (which you are). This will increase slightly for 2025. 2. SSA primarily learns about excess earnings in three ways: - Your self-reporting (Form SSA-131) - Annual earnings verification with IRS (after tax filing) - Employer's W-2 reporting (which happens early the following year) 3. If you exceed the limit, SSA applies a reduction formula of $1 withheld for every $2 over the limit. 4. The withholding isn't usually spread evenly across months. Instead, they may withhold full months of benefits until the excess amount is accounted for. 5. While SSA doesn't have real-time access to your earnings data, they do recalculate after year-end. This is why proactive self-reporting helps prevent surprising overpayment notices. 6. Remember that at FRA, your benefit will be recalculated to give you credit for months when benefits were withheld due to excess earnings. If you're unsure about your specific situation, I recommend scheduling an appointment with your local SSA office to discuss your work plans.

my cousin had this problem last yr. he just didnt report the extra income and it was fine lol. its not like ssa and irs talk to each other that much

I'm confused about something... if you're going over the limit in 2025 but they don't find out until 2026 when you file taxes, do they make you pay back the whole amount at once? Seems really unfair if you didn't know you were going over!

Thanks everyone for all these helpful responses! Based on what I'm hearing, I think my best plan is to: 1. File the SSA-131 form when I start working in October to notify them 2. Keep VERY careful records of my hours and earnings 3. Stay well under the limit to provide a safety buffer 4. Perhaps check in with SSA midway through 2025 (using that Claimyr service if needed to avoid long wait times) I appreciate all the advice and personal experiences. It's given me a much better understanding of how this works. I'm still a bit nervous about potential payment disruptions, but at least now I know what to expect and how to be proactive!

That sounds like a solid plan! One additional tip I'd suggest - since you're planning to work from October through March across two tax years, consider keeping a simple spreadsheet with your weekly earnings and running totals for both 2024 and 2025. This way you can see exactly where you stand at any point. Also, when you file that SSA-131 form, be conservative in your earnings estimate. It's better to underestimate and have them pay you the difference later than to overestimate and face an overpayment situation. The fact that you're being this thoughtful and proactive about it puts you way ahead of most people who just wing it and hope for the best. Good luck with the new position!

One thing I haven't seen mentioned yet is that the SSA has a monthly earnings test for your first year of benefits (which was 2022 for you), but after that it switches to an annual test. Since you're now in the annual test phase, they look at your total earnings for the entire year, not month-by-month. This actually works in your favor for your situation! Even if you have a few higher-earning months, as long as your total for 2024 and 2025 each stay under the annual limits, you're fine. The key is tracking that annual total carefully. Also, I'd recommend calling SSA about a month before you start working to let them know your plans. This gives them time to update your file and potentially adjust your benefits proactively if needed. Much better than dealing with it retroactively!

Just wanted to add something that might help with your peace of mind - I've been through this exact situation twice now (2022 and 2023) and while it can be nerve-wracking, it's totally manageable if you stay organized. One thing I learned is that when you call SSA to report your work plans, ask them to put a note in your file about your expected earnings. This way if there are any questions later, there's a record that you were proactive about communicating. Also, don't stress too much about going slightly over by accident - the system is designed to handle these situations. Yes, there might be some back-and-forth with paperwork, but it's not the end of the world. The key is just being honest and responsive if they contact you. Your 6-month part-time plan sounds very reasonable, and with all the great advice in this thread, you're clearly approaching this the right way. The fact that you're asking these questions ahead of time shows you'll handle it just fine!

I just want to echo what others have said about being proactive - it really makes all the difference! I went through a similar situation last year where I took on some freelance work while receiving SS benefits. One thing that helped me tremendously was setting up automatic calendar reminders to check my earnings totals at the end of each month. It only takes 5 minutes but keeps you from any nasty surprises down the road. Also, if you do end up using that Claimyr service that Miguel mentioned, I can confirm it works well. Used it myself when I couldn't get through on the regular SSA phone lines. Sometimes it's worth the small fee to actually talk to someone who can answer your specific questions rather than trying to navigate their website or sitting on hold forever. Your plan sounds very well thought out. The fact that you're planning this carefully and asking the right questions upfront tells me you'll handle whatever comes up just fine. Good luck with the new position!

I went through something similar a few years ago and wanted to share a few additional tips that might help: 1. Keep copies of all your pay stubs and any correspondence with SSA - I ended up needing these when there was a discrepancy in their records vs. what I actually earned. 2. If you're working for your old company, they might be willing to help you track your earnings to stay under the limit. When I was in a similar situation, my former employer's HR department was actually very accommodating about scheduling my hours to help me avoid going over. 3. One thing that caught me off guard was that bonuses, overtime, and even some benefits count toward the earnings limit - not just your regular hourly wage. Make sure you factor in everything when calculating your totals. 4. Consider setting your personal "safety limit" at maybe 90% of the official limit to give yourself some cushion for unexpected earnings or calculation errors. The earnings test can seem intimidating at first, but you're clearly approaching this thoughtfully. With all the great advice in this thread and your proactive planning, you should be able to navigate this successfully. Best of luck with your return to work!