Did you know your Social Security benefits are different from Social Security payments?
Your benefit is the total amount of money you are entitled to receive from Social Security, while your payment is the amount you actually receive each month.
And while you might expect your payment to be the same as your benefit, there are actually several ways your Social Security payment could be reduced. AARP reports there are eight primary ways your Social Security payment could be reduced, but there are three that are most likely to impact seniors.
Working in Retirement
If you’re still working and earning an income, a portion of your Social Security payment could be withheld. There is a cap on how much income you can earn while still receiving your full Social Security benefit, and if you exceed that amount, your payment could be reduced.
Federal income taxes can also reduce your Social Security payment. Up to 85 percent of your Social Security benefits may be taxable, depending on your total income and filing status.
In addition to your Social Security payment, you may also have Medicare premiums deducted from your retirement check. The standard Part B premium is currently $170.10 per month, but this will go down in 2023.
If you have other debts, such as federal student loans or back taxes, your Social Security payment could be garnished to repay those debts. The government can garnish up to 15 percent of your Social Security payment to repay debts, and if you have more than one debt, the payments could be applied to each debt in turn.
As you can see, there are several ways that your Social Security payment could be reduced. It’s important to be aware of these potential reductions so that you can plan for them in retirement. The Seniors Center is here to help you stay informed, and we’re also fighting to improve Social Security. Follow us on Twitter and Facebook so you never miss a post!