Social Security Benefits

[+ not2rowdy]

Not really even a question here. But the thread on taxes in is the reason I'm starting this one. It fits right in with tax season. The intention is to help educate readers (especially escorts) on a subject related towards long term business decisions.

 

Hopefully our honored providers have a retirement plan. Hopefully they have a plan to ensure sufficient funds for doing that. If part of the plan is Social Security there are a couple of numbers that are important to know. So here's something to consider if you're the typical able-bodied individual residing in the good ole USA.

 

It is MORE COMPLICATED than this! But in the interest of brevity:

 

1. In order to qualify for Social Security at retirement age you must pay into the system for a minimum of 40 quarters (10 years). There are all kinds of rules as to what amount of pay-in meets the requirement for a "qualifying quarter". One dollar won't cut it. The more you pay-in the more you will receive back. Keep in mind that 40 qualifying quarters only meets the absolute minimum of Social Security benefit qualification. If you meet that minimum you will get a check when you retire - but it ain't gonna be much.

 

2. That's because the second number is 35. Your Social Security benefit check is calculated using the "highest 35" years of payments into the system. If you don't have 35 years they use zeros to fill in the spread sheet. So, 40 quarters (10 years) may qualify you - but there's another 25 years (100 quarters) that's also going into that calculation to determine your final benefit. Zeros are bad.

 

There is a good synopsis here - but it is only a SYNOPSIS - the complete rules are 1000's of pages!

 

https://en.wikipedia.org/wiki/Social_Security_(United_States)

 

It would be appreciated if this thread just focuses on education under the current laws - not future speculation.

[Kevin Slater]

Thanks for the primer.

 

The social security tax is a big hit for the self-employed. Anyone who understands his taxes sees just how much he's contributing each year, and it's a bite. A solo 401(k) allows you to invest pre-tax dollars (you're not taxed until you withdraw in your retirement years) except you still have to pay FICA (social security and medicare) on those earnings. I'm much more comfortable directing my own investments both in the 401 and post-tax accounts than I am with the social security, not just because of the sustainability issues that you asked us not to discuss.

 

Kevin Slater

[Griffondog]

Too often overlooked is that Social Security provides more than just retirement benefits to a worker. It also pays survivor and disability benefits, among others.

[whipped guy]

I suggest that everyone should go the www.ssa.gov/myaccount and check out exactly where they stand. You might be amazed at what you have paid into the system and might possibly be dismayed at the benefits that you are entitled to and what you might have done to invest those funds. However, not everyone would have had the discipline to do so. Consequently to each his own.

 

Also, what is mentioned above regarding the self-employed is spot on.

[seaboy4hire]

My employers paid out a nice chunk of change over the years in ss and medicare. I wonder if they didn't have to pay if employees would have gotten better raises better benefits maybe companies could maintain the equipment better or purchase better more reliable equipment maybe the companies could expand with the savings creating more jobs? So many what if's.

 

Hugs,

Greg

[bigvalboy]

www.ssa.gov/myaccount[/url] and check out exactly where they stand. You might be amazed at what you have paid into the system and might possibly be dismayed at the benefits that you are entitled to and what you might have done to invest those funds. However, not everyone would have had the discipline to do so. Consequently to each his own.

 

Also, what is mentioned above regarding the self-employed is spot on.

 

I can't thank you enough for providing the link. Investigating where I stood and amount owed to me, has been on the 'back burner' for sometime now...(yes, I'm a procrastinator). The website was surprisingly easy to navigate, and the information was instantaneous. The amount owed to me at 62 and at full retirement age is far higher than I had mentally calculated. So thanks again.

[whipped guy]

My employers paid out a nice chunk of change over the years in ss and medicare. I wonder if they didn't have to pay if employees would have gotten better raises better benefits maybe companies could maintain the equipment better or purchase better more reliable equipment maybe the companies could expand with the savings creating more jobs? So many what if's.

 

Hugs,

Greg

You are definitely correct about that. Any employer pays his employes based on the bottom line and that bottom line most definitely includes any taxes and other fees that are to be paid on behalf of the employee, as well as benefits. Most employees don't understand the concept. They think that the employer is paying such taxes, fees, and benefits. Well if such taxes, etc. did not need to be paid in many cases that cash would be going into the pockets of employees. So in a sense they are actually (if not technically) paying it themselves. Just one bit of psychological chicanery built into the system by the government.

 

I can't thank you enough for providing the link. Investigating where I stood and amount owed to me, has been on the 'back burner' for sometime now...(yes, I'm a procrastinator). The website was surprisingly easy to navigate, and the information was instantaneous. The amount owed to me at 62 and at full retirement age is far higher than I had mentally calculated. So thanks again.

Something tells me that the escort community will be benefiting from that "amount owed"!

[rickp]

It's also worth noting, that regardless of what amount you're entitled to; there's a minimum Social Security benefit, which in 2013 was $804 a month.

[Kevin Slater]

Too often overlooked is that Social Security provides more than just retirement benefits to a worker. It also pays survivor and disability benefits, among others.

 

I wonder whether an escort would ever be able to qualify for the disability benefit? Perhaps it's just a form filled out by one's doctor and they don't need to delve into the nature of employment, but I suspect the process is more rigorous than that and nary an escort will see a dime of social security disability benefits.

 

Kevin Slater

[bigvalboy]

You are definitely correct about that. Any employer pays his employes based on the bottom line and that bottom line most definitely includes any taxes and other fees that are to be paid on behalf of the employee, as well as benefits. Most employees don't understand the concept. They think that the employer is paying such taxes, fees, and benefits. Well if such taxes, etc. did not need to be paid in many cases that cash would be going into the pockets of employees. So in a sense they are actually (if not technically) paying it themselves. Just one bit of psychological chicanery built into the system by the government.

 

Something tells me that the escort community will be benefiting from that "amount owed"!

 

My own little "Stimulus Package" if you will.....

[Kevin Slater]

It's also worth noting, that regardless of what amount you're entitled to; there's a minimum Social Security benefit, which in 2013 was $804 a month.

 

Is that once you qualify for the minimum amount of quarters paid in, per the original post?

 

Kevin Slater

[rvwnsd]

My employers paid out a nice chunk of change over the years in ss and medicare. I wonder if they didn't have to pay if employees would have gotten better raises better benefits maybe companies could maintain the equipment better or purchase better more reliable equipment maybe the companies could expand with the savings creating more jobs? So many what if's.

 

Hugs,

Greg

 

Plenty of businesses use FICA, other statutory contributions, and taxes as excuses for cutting back on employee salaries/benefits and for limiting investment in equipment and maintenance. Quite frankly, that is a crock of shit. If a business bemoans the cost of statutory benefits, what makes you think they would pass the savings along to their employees if they were no longer required to make those contributions?

[Kevin Slater]

My private insurance disability (occupation specific) required that I apply for Social Security disability. The doctor's report was pretty mild: Moderate social impairment [i can't hear worth beans]; sedentary capacity.

I had an advocator work with me. So, at almost 63, I'm receiving 55% of my pay from 2010 and about 20% of that comes from SSDI.

 

So, in a word: Yeah, it's pretty much the doctor's report. They have the right to examine you if they like.

 

Thanks for that.

 

Out of curiosity, is the SSDI tax or untaxed income?

 

I can't hear worth beans

 

I'M SORRY. IS THE SSDI TAXED OR NO?

 

Kevin Slater

[adriano46]

www.ssa.gov/myaccount[/url] and check out exactly where they stand. You might be amazed at what you have paid into the system and might possibly be dismayed at the benefits that you are entitled to and what you might have done to invest those funds. However, not everyone would have had the discipline to do so. Consequently to each his own.

 

Also, what is mentioned above regarding the self-employed is spot on.

 

Whipped Guy -- thanks for this link -- I should have looked this up well over a year ago and at least now I can actually see things, including how they "overstated" a debt I owed them from last year.

[Scorpio]

Thanks for that.

 

Out of curiosity, is the SSDI tax or untaxed income?

 

 

it is taxed in the same manner as Social Security benefits, so it depends on your modified adjusted gross income.

[desertguy1954]

If SSDI is the only income that you receive, then it is not taxable. It becomes taxable if you are receiving any other income, such as rent or investment income. The amount depends on how much you make in addition to SSDI. Your entire SSDI is not taxed.

[Kevin Slater]

It would be appreciated if this thread just focuses on education under the current laws - not future speculation.

 

Discussing Social Security without regard to its future is like booking a trip to Paris in December based on today's weather.

 

Kevin Slater

[Irtwo]

Keven Slater, where are you quoting "gallahadesquire" from? I don't see his post on this thread.

[jawjateck]

"Social Security".......LOL!!!!!!! I reckon that's my commentary on that program. As an aside, I'm not counting on receiving anything back from my contributions, but it is nice to know that, since I have entered semi-retirement, my self-employment taxes will be minimal this year.....sweet! I'm already loving this new era of paying lower taxes across the board.

[Kevin Slater]

Keven Slater, where are you quoting "gallahadesquire" from? I don't see his post on this thread.

 

I don't either now. I hope it wasn't one of those voices in my head again...

 

Kevin Slater

[seattlebottom]

Another thing that you self employed folks need to do is get official IRS account transcripts showing that you paid the self employment tax for the tax year. SSA doesn't keep records and the IRS will only keep records for a set number of years. Without proof of payment you can't prove that you paid into the system and might be denied all or part of your benefits.

[Kevin Slater]

Another thing that you self employed folks need to do is get official IRS account transcripts showing that you paid the self employment tax for the tax year. SSA doesn't keep records and the IRS will only keep records for a set number of years. Without proof of payment you can't prove that you paid into the system and might be denied all or part of your benefits.

 

The site whipped guy sites above ( http://www.ssa.gov/myaccount ) does exactly that.

 

Kevin Slater

[whipped guy]

www.ssa.gov/myaccount[/url] ) does exactly that.

 

Kevin Slater

In the past the SSA mailed out an annual statement, but the last one that I received was dated 2010. Of course true to form the government never overtly informed anyone of this change. Consequently when I stopped receiving statements I was a bit concerned regarding how to keep tabs on things. That prompted me to investigate the SSA website.

[bigvalboy]

In the past the SSA mailed out an annual statement, but the last one that I received was dated 2010. Of course true to form the government never overtly informed anyone of this change. Consequently when I stopped receiving statements I was a bit concerned regarding how to keep tabs on things. That prompted me to investigate the SSA website.

 

Interesting WG. That was exactly what I was thinking before you provided the link. I too had stopped getting updates, and of course since I had also moved, I was concerned. Over the balance of my life, it will be a nice little chunk of money every month, and besides, the boys will be counting on it...LOL

[seattlebottom]

The site whipped guy sites above ( http://www.ssa.gov/myaccount ) does exactly that.

 

Kevin Slater

 

Couple of years back a friend's dad was set to retire. He had been self employed since 1981. SSA told him to provide proof that he paid SE taxes and was told that the information wasn't available on their computer system. They told him to contact the IRS, but the IRS only had his account information going back to 1992 and one account transcript from 1986. So as with everything, due diligence is a must.