Social Security earnings limit - does January 2025 paycheck for December 2024 work count toward 2024 limit?
I'm 63 and collecting Social Security early while still working part-time. I know about the annual earnings limit ($23,520 for 2025), but I'm confused about a specific situation. If I get paid on January 3rd, 2025 for hours I worked in the last week of December 2024, does that count toward my 2024 earnings limit or my 2025 limit? I'm at about $23,100 for 2024 so far and scheduled to work enough hours in late December that would put me over if that January paycheck counts for 2024. My HR department wasn't sure about how SSA counts this. Anyone dealt with this before? I'm thinking about just taking a few days off to be safe, but I could really use the hours if that January paycheck would count toward 2025 instead.
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Connor Murphy
It's based on when you EARN the money, not when you receive the paycheck. So if you worked those hours in December 2024, they count toward your 2024 earnings limit even if the check comes in January 2025. SSA follows what's called the 'when earned' rule, not the 'when paid' rule for the earnings test. Your W-2 might show that January paycheck in 2025 income, but for Social Security purposes, it's when you performed the work.
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Lucy Taylor
•Thanks, that's what I was worried about. So taking those days off at the end of December is probably smart to avoid going over the limit?
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KhalilStar
take the time off, not worth the hassle. my brother went over by like $200 back in 2023 and they made him repay like $800 in benefits. total pain to deal with!
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Lucy Taylor
•Ugh, that sounds awful. I definitely don't want to deal with overpayments. Better to just enjoy some time off!
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Amelia Dietrich
The rule is that income counts for the year in which you performed the services, regardless of when you're paid. For Social Security purposes, this is different from IRS tax rules (which count income when received). So yes, your December 2024 work that gets paid in January 2025 counts toward your 2024 earnings limit. If you're close to the limit, taking time off is a good strategy. Remember that going over the limit means SSA withholds $1 in benefits for every $2 you earn above the limit. Once you reach your Full Retirement Age (FRA), there's no more earnings test to worry about!
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Kaiya Rivera
•wait i thought it was based on your w-2?? i've been collecting early retirement for 2 yrs and i always just went by what was on my w-2 form when i reported to social security. am i doing this wrong?
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Amelia Dietrich
•The W-2 shows what you were paid during the calendar year, but SSA specifically looks at when the work was performed for the earnings test. It's confusing because the systems don't align perfectly! If your last December paycheck comes in January, your W-2 won't show those December earnings, but SSA still counts them for the December year's limit. Most people don't have to worry about this unless they're right at the limit like the original poster.
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Katherine Ziminski
I'd just take the time off if I were you. Not worth the stress. I got hit with an overpayment notice last year and it was a NIGHTMARE dealing with it. Took me 6 weeks just to get someone on the phone who could explain what happened.
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Noah Irving
•If you're having trouble reaching someone at Social Security, I had great success using Claimyr.com to get through to a live agent. Saved me hours of hold time when I was dealing with a similar earnings limit issue last month. They have a video showing how it works at https://youtu.be/Z-BRbJw3puU - basically they wait on hold for you and call when an agent is on the line. Helped me sort out my earnings questions in one call instead of multiple attempts.
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Katherine Ziminski
•Thanks for the tip! I'll check that out next time I need to call them. Anything to avoid those endless busy signals and hold times!
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Vanessa Chang
DOESNT MATTER cuz they just want excuses to take your $$ back anyway!!! the whole earnings limit is a SCAM! we paid into the system our whole lives and then they PUNISH us for still working?? makes no sense!!!
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Kaiya Rivera
•I feel you but its not really a scam... they give it all back to you eventually when you hit full retirement age by recalculating your benefit. But yeah the whole system is confusing AF.
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Connor Murphy
Just to add something important - if you do accidentally go over the limit, it's not the end of the world. SSA will adjust your benefits for the following months to recoup the overpayment, but you'll eventually get that money back in the form of a higher benefit amount once you reach Full Retirement Age (FRA). They recalculate your benefit to credit you for the months they withheld benefits due to earnings. And remember for 2025, the earnings limit goes up to $23,520 if you're under FRA for the whole year. So you'll have a bit more flexibility next year.
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Lucy Taylor
•I appreciate that perspective. I didn't realize they recalculate it later. Still, I think I'll play it safe this time. I'm just worried about having my monthly checks stop suddenly if I go over. It'll be easier to just take those days off.
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Kaiya Rivera
My sister had this exact issue last year! She got paid on January 2nd for work in December and went over the limit without realizing. They sent her a notice in May and reduced her benefits for like three months to get back the overpayment. Super annoying! Just take the time off - not worth the trouble!
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KhalilStar
•same thing happened to my neighbor!! they dont even tell you until months later and by then you've already spent the money lol
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Lucy Taylor
Thanks for all the advice everyone! I've decided to take those last few days of December off. My manager was understanding once I explained the situation. Going over by even a little bit sounds like it creates a huge headache. I'll save the extra hours for January when I have a fresh earnings limit to work with. Really appreciate all the insights!
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Connor Murphy
•Smart decision! Enjoy your time off, and starting in January you'll have the full $23,520 to work with for 2025. Just keep good records of your earnings throughout the year to avoid surprises.
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