SS and working part time during retirement for a municipality with small pension plan

[Jay968]

What is the name of your state?California

I retired in 2018 at age 66 (full retirement age) and have received SS ever since.

In 2021, I started working part time, about 15 hours a week, ($8000 per year) for a municipality that does not deduct SS tax from my paycheck but has its own pension plan.
I've accumulated about $3000 into that plan to date.

If I stop working and collect that $3000 in one check, how will my current SS be impacted if at all?

Would the current bill going through congress dealing with the WEP change any of this?

Thank you.

 

[LdiJ]

What is the name of your state?California

I retired in 2018 at age 66 (full retirement age) and have received SS ever since.

In 2021, I started working part time, about 15 hours a week, ($8000 per year) for a municipality that does not deduct SS tax from my paycheck but has its own pension plan.
I've accumulated about $3000 into that plan to date.

If I stop working and collect that $3000 in one check, how will my current SS be impacted if at all?

Would the current bill going through congress dealing with the WEP change any of this?

Thank you.

It would not impact your SS benefits unless it put you over the income limit in the calculation to determine if any of your SS benefits are taxable. However that applies to all persons with income from all sources, it is not particular to your type of situation or to the fact that you had income from a source that didn't pay into SS.

And no, the WEP bill would not impact that. A retired person can get some SSI added to their regular SS benefits to give them a little bit higher benefit is theirs is below the poverty level because they have low SS credits. However, someone whose normal income over the years came from a source that did not pay into Social Security would show members receiving very low (or no) Social Security credits therefore making them technically eligible for SSI even though they were not below the poverty level. The WEP bill is designed to rectify that. It does not apply to you because you only had income for a short amount of time, in low amounts, from a source that did not pay into SS. Your SS benefits are based on your actual long term employment which did pay into SS.

 

[Jay968]

It would not impact your SS benefits at all unless it put you over the income limit in the calculation to determine if any of your SS benefits are taxable. However that applies to all persons with income from all sources, it is not particular to your type of situation.

Thanks for the response. How can I find out what that "income limit" is?

I do contribute 10% to Fed taxes with each SS check I receive. I'm married and we do a joint return. Our combined income is about 80,000 net and yes she receives SS too.

 

[LdiJ]

Thanks for the response. How can I find out what that "income limit" is?

I do contribute 10% to Fed taxes with each SS check I receive. I'm married and we do a joint return. Our combined income is about 80,000 net and yes she receives SS too.

It is a complicated calculation but based on your combined income you are already paying taxes on your Social Security benefits therefore the additional 3k in income will have no additional impact on that.

 

[Jay968]

It is a complicated calculation but based on your combined income you are already paying taxes on your Social Security benefits therefore the additional 3k in income will have no additional impact on that.

Hate to be a pest, but I have read that even though one pays tax on SS, an additional even part time job in which no SS tax is deducted and has its own pension can mean one may have a penalty calculated in to their SS check thus reducing it.
Am I just making too little on that part time job to worry about it?

Thanks

 

[LdiJ]

Hate to be a pest, but I have read that even though one pays tax on SS, an additional even part time job in which no SS tax is deducted and has its own pension can mean one may have a penalty calculated in to their SS check thus reducing it.
Am I just making too little on that part time job to worry about it?

Thanks

I think that you may be misinterpreting what you are reading. There is one scenario where SS benefits could be temporarily reduced, but that scenario is where someone is still working and collecting SS benefits prior to full retirement age, and has nothing to do with having a job where there is a private pension instead of paying into SS. That would not apply to you because you are past full retirement age.

Could you find the site again where you read that and post a link to it?

 

[Jay968]

I think that you may be misinterpreting what you are reading. There is one scenario where SS benefits could be temporarily reduced, but that scenario is where someone is still working and collecting SS benefits prior to full retirement age, and has nothing to do with having a job where there is a private pension instead of paying into SS. That would not apply to you because you are past full retirement age.

Could you find the site again where you read that and post a link to it?

Thank you for your comments.
No need to post any link. I came here to get clarification because I admittedly haven't quite understood what I've read.

I'm not going to worry about it anymore.

 

[Foamback]

It would not impact your SS benefits unless it put you over the income limit in the calculation to determine if any of your SS benefits are taxable. However that applies to all persons with income from all sources, it is not particular to your type of situation or to the fact that you had income from a source that didn't pay into SS.

And no, the WEP bill would not impact that. A retired person can get some SSI added to their regular SS benefits to give them a little bit higher benefit is theirs is below the poverty level because they have low SS credits. However, someone whose normal income over the years came from a source that did not pay into Social Security would show members receiving very low (or no) Social Security credits therefore making them technically eligible for SSI even though they were not below the poverty level. The WEP bill is designed to rectify that. It does not apply to you because you only had income for a short amount of time, in low amounts, from a source that did not pay into SS. Your SS benefits are based on your actual long term employment which did pay into SS.

Be careful with your use of the term SSI.

 

[quincy]

What is the name of your state?California

I retired in 2018 at age 66 (full retirement age) and have received SS ever since.

In 2021, I started working part time, about 15 hours a week, ($8000 per year) for a municipality that does not deduct SS tax from my paycheck but has its own pension plan.
I've accumulated about $3000 into that plan to date.

If I stop working and collect that $3000 in one check, how will my current SS be impacted if at all?

Would the current bill going through congress dealing with the WEP change any of this?

Thank you.

Here is a link to relatively-easy to understand information from the SSA:

https://www.ssa.gov/benefits/retirement/planner/whileworking.html

“When you reach full retirement age: Beginning with the month you reach full retirement age, your earnings no longer reduce your benefits, no matter how much you earn.”

 

[LdiJ]

Be careful with your use of the term SSI.

My use of the term SSI was correct. SSI means Supplemental Security Income. That is what people receive (in various circumstances) when they do not personally have Social Security credits or limited Social Security credits to give them benefits.

Could you be confusing SSI with SSDI? (Social Security Disability Income).

 

[quincy]

For those not familiar with the Windfall Elimination Provision, here is a link to the SSA’s explanation of it:

https://www.ssa.gov/pubs/EN-05-10045.pdf

 

[Foamback]

My use of the term SSI was correct. SSI means Supplemental Security Income. That is what people receive (in various circumstances) when they do not personally have Social Security credits or limited Social Security credits to give them benefits.Th

Could you be confusing SSI with SSDI? (Social Security Disability Income).

The OP didn’t give any evidence of needing SSI. They have SS. We have no knowledge of their assets

 

[Bali Hai Again]

Here is a link to relatively-easy to understand information from the SSA:

https://www.ssa.gov/benefits/retirement/planner/whileworking.html

“When you reach full retirement age: Beginning with the month you reach full retirement age, your earnings no longer reduce your benefits, no matter how much you earn.”

For those not familiar you can start the full benefit payments in January (February) of the first year you reach full retirement age without a reduction of benefits as long as your earnings income are below a certain amount up to the month you start receiving. Example: you reach full retirement age in December 2024. You can apply and start receiving benefits in January 2024 without a reduction in benefits as long as your earnings are under $59,520 before December 2024. See the link Q provided. You must apply on time for this to happen.

 

[quincy]

For those not familiar you can start the full benefit payments in January (February) of the first year you reach full retirement age without a reduction of benefits as long as your earnings income are below a certain amount up to the month you start receiving. Example: you reach full retirement age in December 2024. You can apply and start receiving benefits in January 2024 without a reduction in benefits as long as your earnings are under $59,520 before December 2024. See the link Q provided. You must apply on time for this to happen.

Right. I believe that information is included in the links I provided.

 

[LdiJ]

The OP didn’t give any evidence of needing SSI. They have SS. We have no knowledge of their assets

I was giving him an example of what the WEP covered. I think he clearly understood that it did not apply to him since I was explaining why the WEP didn't apply to him.