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Earnings test determines Social Security benefits

Q: How much can I earn in 2012 before my Social Security retirement is reduced?

A: The annual earnings test, also known as the retirement test, involves how calendar year employment earnings might affect your SSA retirement. Only your own gross wages and net income from self-employment is included for the earnings test. Investments, interest, pensions, capital gains income and earnings of a spouse are not. Earnings test amounts are based on your actual age and full retirement age (FRA). FRA is age 66 for people born from 1943 - 1954.

If you will be under your FRA for the entire calendar year, the 2012 earnings limit is $14,640. For earnings over that, one dollar is deducted from benefits for every two dollars you earn above the annual limit. Expect to earn over this amount?

Provide your estimated earnings amount to SSA so your benefits can be adjusted in advance.

Update your estimate during the year if your work plans change.

If you will reach your full retirement age in 2012, the earnings limit on your earnings for months before FRA is $38,880.

One dollar in benefits is deducted for every three dollars earned above this but only for months before you reach FRA.

Starting with the month you reach full retirement age, there is no limit on your earnings. At that point, the annual earnings test no longer applies.

A special monthly annual earnings test is used once, usually the first year of retirement.

This makes it possible to start SSA retirement during any month of the year even if your pre-retirement calendar earnings greatly exceed earnings test levels.

FRA and earnings test information is at

Individually, the earnings test also applies to family members receiving SSA benefits.

Different work rules apply for disability benefits.

If receiving disability or Supplemental Security Income (SSI) contact Social Security for current information.

Q: My newborn has serious health problems and a nurse said I should call Social Security. Why? I do not receive Social Security.

A: Healthy or not, children younger than age 18 can receive Social Security through a parents record if that parent receives SSA retirement, disability or is insured for survivors benefits upon death.

Of more immediate interest to you, Social Security also administers Supplemental Security Income (SSI), a different national program for the aged and disabled that includes benefits for severely disabled children.

Unlike Social Security, SSI is based on financial need. Family income and resource levels first have to be met before medical issues are considered.

For SSI, not all family income or resources count as being available to the applicant because portions are allocated to other family members.

In North Dakota and Minnesota, medical assistance eligibility is established by the county social services but people eligible for SSI are usually eligible for it.

Basic SSI information is at and, while that is a great place start, speaking to a SSA representative about your specific situation will be useful.

Call the national SSA number is 1-800-772-1213, between7:00am - 7:00pm local time, or your local office.

Q: How much is the maximum Supplemental Security Income (SSI) amount?

A: Starting with SSI benefits for January 2012, the maximum SSI amount payable to an individual adult or child will be $698 dollars per month.

The maximum payable to a couple if both people are eligible will be $1,048 per month.

Maximum monthly 2011 amounts are $674 to an individual and $1,011 to an eligible couple. Other income, including Social Security benefits, reduces these amounts.

The SSI benefit for January will be received Dec. 30, due to New Years Day

(Howard I. Kossover is the Social Security Public Affairs Specialist for North Dakota and western Minnesota. Based in Grand Forks, he works with organizations, government agencies and businesses concerning all aspects of the Social Security programs.