If I decide to keep working past my retirement age, how will this affect my social security benefits?

Generally, a client can work and earn income while they are eligible for and receive Social Security benefits. A portion of that benefit will however be subject to different tax rules, from those that are normally applicable.

In 2017, if you are younger than full retirement age, earn more than $16,920 and collect Social Security early your Social Security benefit will be reduced by $1 for every $2 that you earn over that limit.  


This earnings limit is applied on a calendar year basis (January-December) and is also indexed annually for inflation (the amount for 2016 was $15,720).


During the year in which you reach full retirement age, the lower $16,920 amount is increased to $44,880 in the months prior to the month in which you actually reach full retirement age.  


Further, during those months, your Social Security benefits are only reduced by $1 for every $3 that is earned above the $44,880 limit.  


For example, if you reach full retirement age in September, your benefit will be reduced during the months of January through August, assuming your earned income exceeds $44,880.


Once you reach full retirement age, your benefit is no longer reduced regardless of earned income.

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