Social Security survivor benefits & auto allowance - will exceeding earnings limit cause overpayment?

Thank you so much for this information! I'm going to talk to our HR department tomorrow to get documentation on exactly what the auto allowance covers. Do you think I should proactively contact SSA about this, or just wait and see if they send me anything?

There's an important distinction here. SSDI has different rules than survivor benefits, and the specific rules about what counts as earnings can vary depending on how the payment is classified. For survivor benefits with the annual earnings test, it's specifically about wages and self-employment income, not expense reimbursements. Your brother's situation might have been different if the car allowance was considered additional compensation rather than reimbursement for business expenses. The key is how the employer classifies and reports the payment to the IRS.

Those hold times with SSA are ridiculous! I found a service called Claimyr (claimyr.com) that actually gets you through to a real SSA agent without the crazy wait. I used it when I had a similar issue with my earnings limit question. They have a video showing how it works: https://youtu.be/Z-BRbJw3puU For your situation, you really need to speak with someone who can look at your specific case since these allowances can be treated differently depending on how they're classified. Don't wait for a determination letter if you can help it - much easier to handle proactively.

Just double-checked my W-2, and you're right - the auto allowance IS included in Box 1 as well as being listed separately in Box 14. So it looks like it is counted as wages, not just as a reimbursement. That's not good news for me.

I understand your frustration. The earnings test can seem unfair, especially when you're already dealing with loss. The one silver lining is that once you reach your Full Retirement Age (FRA), the earnings limit goes away completely - you can earn any amount without reduction in survivor benefits. Also, any benefits withheld due to the earnings test will increase your monthly benefit amount after you reach FRA. It's not a total loss, just a deferral of benefits.

It's not dollar-for-dollar. For 2024, if you're under Full Retirement Age, SSA withholds $1 in benefits for every $2 you earn above the annual limit ($22,320 in 2024). So if you went over by $4,800, they would withhold $2,400 in benefits. If this is the year you reach FRA, different rules apply with a higher limit and only $1 withheld for every $3 over the limit.

Smart move to be proactive! You can wait for SSA to calculate the exact overpayment - they'll send you a notice after they receive your earnings information from the IRS, but that might not happen until mid-year or later. If you want to handle it now, you can contact SSA directly and inform them of your estimated excess earnings. They can calculate the overpayment and give you payment options. One important note: if you're close to your Full Retirement Age, make sure to tell them, as different rules might apply. And remember, any benefits withheld now will eventually increase your monthly payment after you reach FRA, so you're not losing the money permanently.