FIVE SOCIAL SECURITY CHANGES THAT HAPPENED IN 2017
With much talk of the changes which will necessarily happen to keep Social Security funded for the next few generations, we seem to live in fear. Although the saber-rattling continues, what we see coming for 2017 is not a huge change on the recipient end, however there are a few for the payors. Here are the high points for the year:
- The Cost of Living Adjustment was an increase of 0.3% for 2017. This was based on the CPI for the third quarter of 2014 through the third quarter of 2016. For most recipients, this means approximately $4 per month added to their checks. Incidentally, Medicare Part B premiums also increased $4, making this a wash for the 70% of recipients who pay their premiums directly. For many, they could actually see a very small decrease.
- The earnings caps have changed. Those 65 and under will be penalized if they earn over $16,920, up from $15,720 in 2016. For every two dollars earned over the cap, you will have one dollar of benefits withheld. For those who turn 66 this year, the cap is $44,880, and the penalty changes to one dollar withheld for every three earned. Once you are 66, the cap is lifted and your payments will be increased to give back any withheld benefit.
- The maximum possible benefit increased by $48 to $2,687. This is for someone retiring at the full retirement age of 66 who has been taxed on the maximum earnings for their entire career, and most earners will see negligible changes.
- For wage-earners, you will now be taxed on more of your income, up from $118,500 to $127,200. This results in a $540 bump, but if you are self-employed, it doubles. The tax rate is still the same, however, at 6.2%.
- Retirement age is changing. If you were born in 1955, your new retirement age is 66 years 2 months. Be sure that you retire at the correct time to avoid losing income to a permanently reduced benefit. And expect to continue to see this retirement age increase over the next few years.
Social Security benefits may be claimed at 62, or as late as age 70. The longer you wait, the higher your benefit. Claiming early does result in a permanent lowering of your payment amount. This may also affect any claim your surviving spouse may have on your benefits.
If you have any concerns about your retirement, Mestayer Law Firm will help you make decisions which will affect your income in your later years. Give us a call for a consultation, and bring your questions. We will help you navigate Social Security and the changes which may affect you.
To talk to an attorney with Mestayer and Associates, call us at 228-762-1193 or contact us on our website at www.pascagoulalaw.com. You can also visit our office located at 2128 Ingalls Ave. in Pascagoula, Mississippi. We look forward to talking with you!