New Year, New Rules: 6 Biggest Social Security Changes for 2020 (Part 2)
With the New Year is already upon us, changes to the Social Security Administration’s rules will be going into effect on January 1st. These include changes to what beneficiaries will be paid, as well as adjustments to what is necessary to qualify for Social Security benefits.
For more than four decades our Long Beach Social Security attorneys have devoted their careers to helping disabled workers obtain the benefits they deserve. In this two part article we discuss the six biggest changes to Social Security in 2020.
CLICK HERE for Part 1 of Social Security Changes for 2020
Higher Maximum Social Security Benefit for the Wealthy
Social Security worker benefits are capped at a certain level. In 2019 the maximum Social Security retiree benefit was $2,861 a month.
In 2020, retirees who earned more while working could net a bigger benefit each month. This year the maximum monthly benefit at full retirement age will increase by $150 a month to $3,011 – which translates to an extra $1,800 a year for higher income earners during retirement.
Increase in Withholding Thresholds for Early Social Security Filers
In addition to a permanent reduction to monthly benefits, early filers who still continue to work and generate income face another issue.
The “retirement earnings test” authorizes the SSA to withhold some or all of your Social Security benefits if you’ve begun taking benefits prior to “full retirement age” and are still working and surpass certain income thresholds.
In 2020, an individual under full retirement age is allowed to earn $1,520 a month ($18,240 annually) without any withholding of Social Security benefits. This is a $50/month increase over 2019. However, before full retirement age, the SSA will withhold $1 in benefits for every $2 in earned income above this threshold of $18,240.
And, people who reach full retirement age in 2020 can earn $4,050/month ($48,600 annually) before the same withholding will kick in – a $140 month increase over 2019. At which time withholding is only $1 in benefits for every $3 in earned income above the threshold of $4,050/month.
Once a person reaches full retirement age (no matter when they begin taking Social Security benefits), the retirement earnings test no longer applies. And, any withheld Social Security benefits are returned in the form of a higher monthly payout – after hitting your full retirement age.
Qualification for Social Security Retirement Benefit Harder
In order to qualify for Social Security retirement or disability benefits, a person earns it through years of working – during which they accumulate “work credits”. 40 lifetime work credits – with a maximum of four a year – are required to qualify.
The work credits are earned based on income in each year. In 2019, $1,360 in earned income gave individuals one lifetime work credit – and $5,440 in earned income (4 X $1,360) gave individuals a year’s worth of credits.
In 2020, a higher income is required to earn work credits, and qualifying will require $1,410 in earned income for one credit – and $5,640 for the year to receive the maximum of 4 credits.
Long Beach Social Security Disability Attorneys
If you or a loved one is unable to work due to a disabling injury, medical condition or disease our skilled and experienced attorneys are here to help you understand the complex rules – so you get the maximum Social Security Disability benefits for which you qualify.
The Law Office of Cantrell Green is a group of highly qualified and experienced disability attorneys who have obtained millions of dollars in Social Security Disability benefits for thousands of clients in Long Beach, Orange County and the greater Los Angeles. Our attorneys care about every client, and fight tirelessly to obtain the benefits you deserve.
Long Beach Social Security Disability Attorney Consultation: 800-964-8047