Social Security earnings test switching from monthly to annual limit when starting benefits in late 2025?
I'm planning to retire later next year but I'm confused about how the earnings test works when you start collecting Social Security in the middle of the year. If I apply for my retirement benefits to begin in October 2025 (I'll be 64), I understand I'll be under the monthly earnings limit for those last three months of 2025. But what happens when January 2026 rolls around? Do I automatically switch to the annual earnings test for the entire year of 2026? Or am I still subject to the monthly test for the first year I'm receiving benefits? My financial planner and I have different understandings of how this works, and the SSA website isn't totally clear to me. I'll still be working part-time in 2026 so I need to understand how this affects my benefits. Thanks for any clarity!
16 comments
Join the conversation
Lincoln Ramiro
Great question! Yes, you will switch to the annual earnings test starting January 2026. The monthly earnings test only applies during the first calendar year you receive benefits. Since you'll start receiving benefits in October 2025, you'll use the monthly test for October-December 2025, then switch to the annual test for all of 2026 and beyond. The monthly test is really beneficial for people who retire mid-year because it allows you to earn as much as you want before your retirement month without affecting your benefits. Just make sure you stay under the monthly limit (about $1,850 in 2025) for those last three months of 2025.
0 coins
Henrietta Beasley
•Thank you so much! That confirms what I thought, but my financial planner kept insisting that the monthly test applies for a full 12 months after you start benefits. I'm relieved to hear I'll switch to the annual test in January. That makes planning for 2026 much easier.
0 coins
Faith Kingston
I went thru this last yr and my SS was reducded even tho I didnt go over the monthly amounts!! They look at ANNUAL income first then monthly. If u earned too much earlier in 2025 b4 claiming they will STILL reduce benefits. The SSA website is VERY misleading on this!!
0 coins
Lincoln Ramiro
•Actually, that's not correct. In the first year you claim benefits, you can use the monthly earnings test regardless of how much you earned before you started receiving benefits. The earnings before your benefit start month don't count against you. If your benefits were reduced when they shouldn't have been, you should contact SSA to have this corrected.
0 coins
Emma Johnson
My husband had almost the exact same situation! He started SS in November 2023 and for those last two months of 2023, we used the monthly test. Then in January 2024, it automatically switched to the annual test. His benefit amount wasn't affected at all since he stayed under the limits. Good luck with your retirement!
0 coins
Liam Brown
Don't forget that the monthly earnings test in 2025 will be higher than it is now - probably around $1,850/month if you're under FRA. And for 2026, when you switch to the annual test, you'll have an annual limit of about $22,200 for the year. Since you're working part-time, just make sure your 2026 earnings stay under that amount if you want to avoid any benefit reductions.
0 coins
Henrietta Beasley
•Those numbers are really helpful, thanks! My part-time work should keep me under the annual limit, but it's good to have the actual figures to work with. Do you know if they announce the official 2025 limits soon? I want to use the actual numbers for my planning.
0 coins
Olivia Garcia
i had the same question last year and ended up waiting on hold with social security for THREE HOURS only to get disconnected right when someone finally answered. so frustrating! ended up having to take a day off work to go to the local office but yes they confirmed exactly what the first responder said about switching to annual in january.
0 coins
Noah Lee
•I've had the same horrible experience trying to call SSA! After multiple disconnections, I finally used a service called Claimyr that got me through to a rep in under 30 minutes. They connected me directly with SSA and I was able to get all my earnings test questions answered. Saved me from taking a day off work. Their site is claimyr.com and they have a video showing how it works: https://youtu.be/Z-BRbJw3puU. Worth it to avoid the hold time frustration!
0 coins
Ava Hernandez
When my sister retired 2 yrs ago, the SSA made a mistake and imposed the wrong earnings limit. It took her almost 6 months to get it fixed and get her back payments. Make sure you understand exactly what your earnings will be and document everything. My advice is to print out the rules from the SSA website and bring them with you if you go to an office appointment. Some of the representatives don't fully understand all the nuances of the monthly test vs annual test.
0 coins
Emma Johnson
You don't mention if you will reach your full retirement age (FRA) in 2026. That's important because the earnings limit is different in the year you reach FRA, and then it goes away completely after that.
0 coins
Henrietta Beasley
•Good point! No, I won't reach my FRA until 2027 (I was born in 1963, so my FRA is 67). So I'll have the regular earnings limit in 2026, and then the higher limit for part of 2027 until my birthday. Thanks for pointing that out!
0 coins
Faith Kingston
My neighbor just went thru this exact thing and said if u work AT ALL in jan 2026 they'll take ur whole check for that month so be careful bout working that month
0 coins
Lincoln Ramiro
•That's not accurate. Once you're on the annual earnings test in 2026, they look at your earnings for the whole year, not month by month. They only withhold benefits if your annual earnings exceed the limit. And even then, they withhold $1 in benefits for every $2 you earn above the limit - they don't take your whole check unless your earnings are extremely high.
0 coins
Liam Brown
One other thing to consider is that if some of your benefits are withheld due to the earnings test, they're not lost forever. Once you reach your full retirement age, SSA will recalculate your benefit amount to give you credit for the months when benefits were withheld. So even if you do have some reductions in 2025 or 2026, you'll get that money back in the form of a higher monthly payment starting at your FRA.
0 coins
Henrietta Beasley
•I didn't know that! That's really good news. So essentially if I end up earning too much and having some benefits withheld, it's more like a deferral than actually losing the money. That makes me feel better about my decision to start benefits before FRA. Thank you!
0 coins