As the number of Americans receiving Social Security benefits continues to grow, it’s essential to understand the eligibility criteria for this crucial financial safety net. New social security guidelines are shaping the landscape for those seeking to secure their retirement or disability benefits.
New Social Security Guidelines: Identifying 8 Categories of Ineligible Benefit Recipients (Photo: Yahoo Finance)
New Social Security Guidelines: Who Qualifies and Who Doesn’t?
In a recent data released by Go Banking Rates, in September 16, 2023, as the number of Americans receiving new Social Security benefits continues to swell, understanding the eligibility criteria becomes increasingly crucial. With approximately 67 million Americans currently benefiting from the program, and a growing number of individuals entering the system and enjoying longer lifespans, it’s essential to grasp the eligibility intricacies. The AARP reports that nearly nine out of every ten workers aged 21 to 64 are engaged in “covered” employment, meaning they contribute to new Social Security through payroll or self-employment taxes. However, not all who’ve worked in the United States qualify for new Social Security benefits, making it imperative to assess one’s eligibility before applying.
To access new Social Security retirement benefits, a minimum age threshold must be met, which currently stands at 62 years. Additionally, eligibility for spousal benefits hinges on either being 62 years or older or caring for a child under 16 or with a disability entitled to benefits on your spouse’s record, according to the SSA. Falling short of these age requisites renders one ineligible.
Securing retirement benefits necessitates earning 40 new Social Security credits, achieved through income-based Social Security tax payments, with a maximum of four credits attainable annually. In 2023, each credit corresponds to $1,640 in earnings, equating to $6,560 for the year, as per the AARP. Hence, eligibility hinges on accumulating a total of 40 credits, implying an extended period of work.
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Contribution and Government Plans: Factors Impacting Eligibility
According to the report published by Nasdaq, new Social Security operates on a self-funded principle, with beneficiaries contributing to the program. Employed individuals see these contributions deducted automatically from their paychecks, while self-employed individuals typically manage their payments through quarterly estimated taxes. However, if you’ve been exclusively self-employed without prior tax contributions, you risk being ineligible due to the absence of a contribution record.
Those covered by state-funded pension schemes in lieu of new Social Security, such as certain state, county, and municipal employees, typically do not qualify for Social Security benefits due to their non-participation in the system. Furthermore, employees under older federal pension systems and specific railroad workers, governed by systems dating back to the 1930s, find themselves excluded from Social Security eligibility. Foreign nationals employed in the U.S. by their home governments or international organizations like the United Nations might find themselves ineligible for Social Security benefits, adding complexity to eligibility criteria.
While many expat retirees can receive new Social Security, eligibility varies based on one’s choice of retirement destination. Some countries may limit or exclude benefits, even for American citizens who’ve contributed over decades. Individuals convicted of crimes and incarcerated for more than 30 days see their Social Security benefits suspended, creating a unique eligibility challenge. Upon release, benefit payments can be reinstated, albeit without retroactive compensation for the period of incarceration. Navigating the maze of new Social Security eligibility requires careful consideration of these factors, ensuring that those who deserve these crucial benefits receive them while upholding the program’s integrity and sustainability.
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