||Ask Dr. Don
Collecting Social Security
while working in retirement
Dear Dr. Don,
I am 65 and a half. I am working full-time. Can I collect my full
Social Security now even though I am working, or if I take my Social
Security now will they hold money back because I make too much? I
make over $70,000 a year.
According to the Social
Security Web site, "Once you reach full retirement age
(65 for people born before 1938), there is no limit on the amount
you can earn while collecting Social Security benefits. Before age
65, your payments may be reduced depending on the amount you earn."
With your level of income outside of Social Security,
85 percent of your Social Security income will be treated as taxable
income. At lower income levels, the percentage of Social Security
income treated as taxable income would be as low as 50 percent.
Publication 554, Older Americans'
Tax Guide, provides a worksheet that helps you determine
how your Social Security income will be taxed.
Working and collecting Social Security benefits may
even cause your benefits to increase since benefits are based on
your highest earnings years. For all the details on working and
collecting retirement benefits, see the electronic leaflet "How
Work Affects Your Benefits" on the Social Security Web
-- Posted: April 22, 2004