Social Security family benefits calculation confusion - 62 vs FRA formula for kids
Just got approved for early SS retirement at 62 (begins next month) and I'm SUPER confused about family benefits for my kids. My benefit at 62 will be about $2,700/month and would've been around $4,050 at full retirement age. Here's where I'm lost - when I first spoke with an SSA rep last week, she told me my two teenage daughters (14 and 16) and my wife (who's their primary caregiver) would each get approximately $2,025 based on my FRA amount x 50%. Then yesterday, a different rep called back saying the first calculation was wrong and they'd each get about $1,010 based on something called the "family maximum" divided by 3. The second amount sounds more realistic (first seemed crazy high), but I don't know which formula is correct. Can anyone who understands family maximum benefit calculations explain what's going on? And two quick related questions: 1. For tax withholding - do I need separate W-4V forms for myself, my wife, and kids? We file jointly, but not sure how this works for SS benefits. 2. We usually spend 6-8 weeks visiting family overseas each summer - do we really need to notify Social Security about this? One booklet says yes for trips over 30 days, but the rep told me it's not necessary for vacations.
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Ali Anderson
The second rep gave you the correct information. The family maximum benefit (FMB) is typically around 150-180% of your primary insurance amount (PIA), which is what you'd get at full retirement age. Then that amount, minus your own benefit, gets divided among eligible dependents. For example, if your FRA benefit would be $4,050, your family maximum might be around $7,075. Since you're taking benefits early, you get $2,700, leaving about $4,375 to be split among your three dependents, so about $1,458 each. However, each dependent is also limited to 50% of your PIA, which would be $2,025 in your case. So the second rep's estimate of $1,010 each is in the ballpark, though possibly a bit low depending on your exact family maximum calculation.
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Sean Matthews
•Thank you! That helps make sense of it. So basically the family maximum is what puts the cap on things, not the 50% per person? I guess that's why the original calculation seemed suspiciously high to me.
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Zadie Patel
Regarding your tax withholding question - you need SEPARATE W-4V forms for each person receiving benefits. Even though you file jointly for taxes, Social Security treats each beneficiary separately. For your kids' benefits - you're right that they likely won't be taxable UNLESS your kids have other income that puts them above the taxable threshold. Most minor children don't have enough total income to owe taxes on SS benefits.
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A Man D Mortal
•This is good to know! I was wondering the same thing about my grandkids benefits. Does anyone know if the childrens benefits count towards the parents income for tax purposes? Or are they really considered the childs income?
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Zadie Patel
•The children's benefits are considered the child's income, not the parents'. That's why they're usually not taxable - most kids don't have enough other income to reach the threshold where SS benefits become taxable.
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Declan Ramirez
i went thru this last yr when i started my SS at 63. the famliy max was WAY less than what i thought my kids would get. my wife and 2 kids each got about $950 even tho my benefit was $2800. they told me its bcuz of the family maximm rule. its frustrating but thats how it works. the first rep was definitely wrong.
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Sean Matthews
•Thanks for sharing your experience - sounds nearly identical to our situation. Glad to know I'm not the only one who was surprised by how the family maximum works!
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Emma Morales
The 30-day reporting requirement DOES apply even for vacations! I learned this the hard way. It's not because they'll stop your benefits for a short trip, but they need to know for various technical reasons including potential application of foreign work restrictions and certain country-specific payment rules. If you're visiting a country with normal relations with the US, it's just a simple notification. You can do it through your my Social Security account online (there's a "Report a Change" section) or call them. Nothing complicated, but don't skip it.
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Sean Matthews
•Really?? The SSA rep specifically told me vacations don't count when I asked about this. This is so confusing. Does anyone have a link to the official policy on this?
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Katherine Hunter
If you're having trouble reaching someone at SSA to clarify these rules, I'd recommend trying Claimyr. After getting conflicting info like you did, I was going CRAZY trying to get through on the phone. Kept getting disconnected or waiting for hours. A friend told me about claimyr.com - it got me through to a real person at SSA in about 15 minutes! They have a video showing how it works: https://youtu.be/Z-BRbJw3puU Totally worth it to get clear answers directly from SSA, especially with complicated family benefit questions like yours.
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Lucas Parker
•I was just about to suggest this! I used this service last month when I needed to talk to someone about my disability review. Had been trying for DAYS to get through the normal way. The SSA phone system is completely broken.
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A Man D Mortal
The first rep was definitely wrong!!! My husband retired early and I stay home with our 10 year old. We got the same runaround - first they said one amount then called back with a much lower number. Something about "family maximum benefit" which is TOTALLY UNFAIR by the way. Why should our benefits be reduced just because there's more of us??!! The system penalizes families with children!
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Ali Anderson
•The family maximum isn't designed to penalize families - it's actually to prevent situations where the total benefits paid to a family might exceed what the worker earned when working. It's been part of the program since 1939. Without it, in some cases, families could receive significantly more in SS benefits than the worker's actual pre-retirement earnings.
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Lucas Parker
About the 30-day reporting requirement: I worked for SSA for 22 years before retiring. The rule does exist, but it's primarily for extended stays abroad. The technical requirement is that you must report if you're outside the US for 30 consecutive days or longer, or if you're not a US citizen. For routine vacations of US citizens, while technically required to report, it rarely impacts benefits. For the family benefit calculation, the second rep was correct. The formula is complex but essentially: 1. Your PIA (benefit at FRA) is calculated 2. Family maximum is determined by a separate formula 3. Your actual benefit is subtracted from the family maximum 4. Remainder is divided among eligible dependents (up to 50% of PIA each) For tax withholding, each beneficiary needs their own W-4V, including children.
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Sean Matthews
•Thank you for this detailed explanation! As a former SSA employee, do you know if there's any particular form we should use to report our trip, or is a phone call sufficient? We'll be gone for about 6 weeks visiting my wife's family in Europe.
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Lucas Parker
•A phone call is sufficient, or you can report it through your my Social Security account online. Just make a note of who you spoke with and when. For a 6-week vacation to Europe, it's extremely unlikely to affect anything, but it covers you for the reporting requirement.
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Declan Ramirez
the kids benefits DO end when they turn 18 or graduate high school (up to 19 if still in high school) so keep that in mind for ur planning
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Sean Matthews
•Good point - our daughters are 14 and 16 now, so we've got a few years but definitely need to plan for when those benefits stop.
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Isabella Costa
I'm new to this community but going through a similar situation with early retirement and family benefits. This thread has been incredibly helpful! I had no idea about the family maximum rule and how it actually works. One quick question for those who've been through this - when you're calculating your family's total monthly budget, do you factor in the possibility that the family maximum calculation might change if Social Security recalculates your PIA? I've heard sometimes there are adjustments made after you start receiving benefits, especially in the first year. Also, @Sean Matthews, thanks for starting this discussion. The conflicting information from SSA reps is so frustrating - it's reassuring to know others have experienced the same thing!
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Fiona Sand
•Welcome to the community, Isabella! Glad this thread has been helpful. Regarding your question about PIA recalculations - yes, it's definitely worth factoring that in. SSA sometimes makes adjustments during the first year, especially if there were any errors in calculating your earnings history or if you had wages after filing that affected your highest 35 years of earnings. These adjustments would affect both your benefit and the family maximum calculation. I'd suggest being a bit conservative in your budgeting until you're past that first year and everything has stabilized. The good news is that if there are adjustments, they usually result in back payments if you were underpaid initially. And you're absolutely right about the conflicting information being frustrating! It seems like even SSA reps sometimes struggle with the family maximum calculations since they involve multiple formulas working together.
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Ava Johnson
Welcome Isabella! This has been such a helpful thread for all of us dealing with the family benefits maze. Regarding PIA recalculations - I actually experienced this firsthand. About 4 months after I started receiving benefits, SSA sent me a letter saying they had recalculated my earnings record (apparently one of my employers from 2019 had reported wages late). My monthly benefit increased by about $85, and the family maximum went up proportionally. We got a nice back payment check, but it definitely threw off our budgeting for a few months. The adjustment affected everyone's benefits - mine, my spouse's, and our kids'. So Fiona's advice about being conservative in your first-year budgeting is spot on. I'd recommend keeping some cushion in your financial planning until you hit that one-year mark and everything stabilizes. Also, make sure you keep all your SSA correspondence! When they made the adjustment, having those original benefit letters helped me verify the calculations were correct.
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Gemma Andrews
•This is exactly the kind of real-world experience I was hoping to hear about! Thank you for sharing, Ava. The fact that a late wage report from 2019 could still affect your benefits years later is something I never would have considered. I'm definitely going to take both your and Fiona's advice about conservative budgeting in the first year. It sounds like these adjustments can be significant - an $85 increase in your benefit probably meant meaningful increases for your family members too given how the family maximum calculation works. Did SSA give you any advance notice that they were reviewing your earnings record, or did the recalculation letter just show up out of the blue? I'm wondering if there are any warning signs to watch for or if it's just something that happens randomly when employers submit late reports. Also keeping all correspondence is great advice - I'm already learning that with Social Security, documentation is everything!
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PixelPioneer
Welcome to the community! This discussion has been incredibly valuable - I'm also navigating early retirement and family benefits, and the complexity is overwhelming. One thing I haven't seen mentioned yet is how the earnings test might affect your situation. Since you're taking benefits at 62, if you have any earned income (work, consulting, etc.) above the annual limit (around $22,320 for 2024), they'll reduce your benefits temporarily. But here's what's interesting - this earnings test applies to ALL family members' benefits, not just yours. So if you're planning to do any part-time work or consulting in retirement, make sure to factor this in alongside the family maximum calculations everyone has discussed. The earnings test can significantly impact your family's total monthly income, especially in those first few years before you reach full retirement age. Has anyone else dealt with the earnings test while receiving family benefits? I'd love to hear how it affected your planning.
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