Social Security first year rule - earnings limit based on paycheck dates or hours worked?

The earnings limit for Social Security is based on when you RECEIVE the money, not when you earned it. So that February work paid on March 5th would count toward your March earnings limit. This is how the SSA applies the earnings test for the first year rule. This is actually helpful if you're planning your retirement carefully. It means you could work a lot in December 2024 and get paid in January 2025, and it wouldn't count against your first-year monthly limits if you retire in 2025. Just make sure you're tracking your actual pay dates and keeping all your pay stubs. If you get questioned later, you'll need to show when you actually received the money.

my sister had this EXACT problem last year!! SSA counted her earnings when she got PAID not when she DID the work. she ended up having to pay back almost $2000 because her january check was huge from december overtime and she thought it wouldn't count!!!! KEEP TRACK OF EVERYTHING!!!!!

What everyone's saying about payment dates is correct, but I wanted to add that the monthly earnings test only applies during your first year of retirement. After that, it switches to an annual limit (which is $21,240 for 2025 if you're under FRA the whole year). That's something to keep in mind for your planning. Also, if you're still working for the same employer after claiming benefits, make sure your reduction in hours represents a significant retirement. SSA can question whether you're really retired if your work pattern doesn't change much.

I recently helped my father with this exact situation. After spending 4 days trying to reach someone at SSA (constant busy signals and disconnections), we found a service called Claimyr that got us through to an actual SSA agent in under 10 minutes. The agent confirmed it's when you RECEIVE the money that counts, not when you earn it. They also recommended keeping detailed records of all payments received after your retirement month begins. If you need to speak with SSA directly about your specific situation, check out claimyr.com or watch their demo at https://youtu.be/Z-BRbJw3puU - saved us hours of frustration!

Congrats on your retirement! Just wanted to share that when I retired 2 years ago, I made sure all my big commissions came in before my retirement month started. Made things SO much easier to manage with the monthly limit.

Have u thought about waiting til your FRA??? Then you don't have to worry about any limits at all! That's what I did and sooooo much less stressful!

My understanding was it's when you EARNED the money not when it's paid??? That's what the SSA agent told me on the phone last month. Now I'm confused 🤔

One important thing no one has mentioned yet: if you exceed your monthly limit, Social Security will withhold your ENTIRE benefit for that month, not just the amount you went over. This trips up a lot of people. For example, if your monthly limit is $1,950 and you earn $2,000, you don't just lose $50 in benefits - you lose your entire SS payment for that month. Plan accordingly!