KEY TERMS:
- FRA: Full Retirement Age – The age at which a person may first become entitled to full or unreduced retirement benefits.
- PIA: Primary Insurance Amount – The benefit a person would receive if he or she elects to begin receiving retirement benefits at his or her FRA.
- Spousal Retirement Benefit – A spouse receives one-half of the worker’s PIA, unless the spouse begins collecting benefits before his or her FRA.
- DRC: Delayed Retirement Credits – Social security benefits are increased by a certain percentage if an individual delays retirement beyond his or her FRA.
- Provisional Income – The level of income that is used to determine whether a taxpayer is liable for tax on his or her Social Security benefits.
PERCENT RECEIVED
Percent of Primary Insurance Amount (PIA) received at each age of eligibility. If a worker or spouse begins collecting benefits before his or her Full Retirement Age (FRA), the benefit amount is reduced. Workers can earn Delayed Retirement Credits (DRC) for waiting until after their FRA to receive benefits.
For Primary Earners with FRA of 66
| Age |
66 |
67 |
68 |
69 |
70 |
| % of PIA |
100% |
108% |
116% |
124% |
132% |
For Primary Earners with FRA of 67
| Age |
62 |
63 |
64 |
65 |
66 |
67 |
68 |
69 |
70 |
| % of PIA |
70% |
75% |
80% |
86.7% |
93.3% |
100% |
108% |
116% |
124% |
For Spouses with FRA of 66
| Age |
66 |
| % of PIA Received |
50% |
For Spouses with FRA of 67
| Age |
62 |
63 |
64 |
65 |
66 |
67 |
| % of PIA Received |
32.5% |
35% |
37.5% |
41.7% |
45.8% |
50% |
TAXATION OF BENEFITS
Provisional Income
| |
0% |
50% |
85% |
| Single |
<$25,000 |
$25,001 - $34,000 |
>$34,000 |
| Married |
<$32,000 |
$32,001 - $44,000 |
>$44,000 |
Provisional income is your Adjusted Gross Income + Tax-Exempt Interest + 50% of your Annual Social Security
REDUCTION OF BENEFITS
Earnings Test
| Prior to FRA |
$1 reduction in benefits for every $2 of earned income over $21,240 threshold. |
| Year of FRA |
$1 reduction of benefits for every $3 of earned income over $56,520 threshold. |
| FRA |
$0 reduction |
FULL RETIREMENT AGE
| Year of Birth |
FRA |
| 1943-1954 |
66 |
| 1955 |
66 & 2 months |
| 1956 |
66 & 4 months |
| 1957 |
66 & 6 months |
| 1958 |
66 & 8 months |
| 1959 |
66 & 10 months |
| 1960 or later |
67 |
Note that if you qualify for benefits as a Survivor, your full retirement age may be slightly different. Visit the Social Security website or call the Stifel Wealth Planning Department for more information.
Maximum Taxable Earnings $160,200
Maximum possible monthly benefit for those reaching their Full Retirement Age in 2023 is $3,627.
Stifel does not offer legal or tax advice. You should consult with your legal and tax advisors regarding your particular situation.
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