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Getting hold of the SS office is a crap shoot, figured I'll give this forum a go at it. Currently 63 (64 in January, FRA 67)), thinking of starting SS in June of 2024 while still working a job that pays above earning limit. Can I calculate how much over the limit I would be, and thru payroll, contribute to an IRA to reduce my taxable income below the earnings limit to avoid penalties ?
THE limit goes not by box 1 taxable wages on your w2 ,but box 3 which adds them back in for this purpose.
box 3 is called social security wages and that is used to determine whether you are over or not for purposes of the earnings cap .l
i worked one day a week and put my entire check in the 401k .
box one showed hardly any wages at all . box 3 showed my entire amount so i had to wait until the year i would be fra to file since box 3 is what counts
Last edited by mathjak107; 08-19-2023 at 06:42 AM..
I am working part-time, and since my retirement life plans were flushed down the giant toilet of fate, I figured I might as well work more hours and collect SS, too, while I am still here on the planet and in fairly good health. At least maybe I could find some value in the remainder of my life helping my daughter and other family members financially.
But if I am going to collect SS only to have to give more to the government, I might as well wait for FRA. Haven't done any actual calculations, though. Just thinking.
this is something people think they can do to get their income down for purposes of collecting but they can’t use a 401k , ira or hsa since that is what is included in box 3 income for this purpose
Getting hold of the SS office is a crap shoot, figured I'll give this forum a go at it. Currently 63 (64 in January, FRA 67)), thinking of starting SS in June of 2024 while still working a job that pays above earning limit. Can I calculate how much over the limit I would be, and thru payroll, contribute to an IRA to reduce my taxable income below the earnings limit to avoid penalties ?
You can't reduce pay by using HSA, 401k, IRA
You have to look at earning limit about $21k while working. Amount will be adjusted with COLA. So don't know what limit will be for 2024 & beyond.
Give up $1 in benefit for every $2 income.
If you make $30k may not be so bad. At $60k forget it.
The higher you go could mess up your work history & result in lower benefit.
this is something people think they can do to get their income down for purposes of collecting but they can’t use a 401k , ira or hsa since that is what is included in box 3 income for this purpose
this is something people think they can do to get their income down for purposes of collecting but they can’t use a 401k , ira or hsa since that is what is included in box 3 income for this purpose
Quote:
Originally Posted by DaveinMtAiry
Does that include ROTH IRA withdraws?
No,
the SS pre-FRA earnings limit only applies to "earned income", ie, wages and salary, etc. As said, Box 3 of a W-2. Not to withdrawals from savings or investment accounts.
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Contributions, not withdrawals count
