Social Security: Suspending Payments vs. Withdraw of Benefits Election скачать в хорошем качестве

Social Security: Suspending Payments vs. Withdraw of Benefits Election

If you have started receiving your social security benefits but you now want to suspend receiving your social security payments going forward, you have two options available to you. You can either: 1) Suspending Your Social Security Benefit 2) Withdrawing Your Social Security Benefit They seem like the same thing, but they are two completely different strategies. One option requires you to pay back the social security benefits already received; the other does not. One option has an age restriction; the other does not. Some of the most common reasons why retirees elect to either suspend or withdraw their social security benefits are: • Retirees either take on either part-time or full-time employment or receives an inheritance, they no longer need their social security benefit to supplement their income, and they would prefer to allow their social security benefit to keep growing by 6% - 8% per year. • A retiree turns on their social security prior to Full Retirement Age, begins making income over the allowable social security threshold, and is now faced with the social security earned income penalty • Since social security benefits are taxable income to many retirees, by suspending their social security payments, it opens up valuable tax and wealth accumulation strategies. We will cover a number of those strategies in this article. Contact Michael Ruger with Questions: 518-477-6686 or mruger@greenbushfinancial.com Visit our website: https://www.greenbushfinancial.com/ Subscribe to our channel for more financial planning tips:    / @greenbushfinancialgroup   #socialsecurity #greenbushfinancial --------------------------------- 0:00 Intro 0:50 Suspension VS Withdrawal Reasons 1:50 Withdraw of Benefits 3:40 Taxation 5:00 Repay Benefits Received 6:00 Application Process for Withdraw 6:40 Suspending Benefits 9:15 Reasons to Suspend Your Benefits 10:45 Roth Conversions 11:20 Reduce Future RMDs 13:20 Example ------------------------------------ Frequently Asked Questions (FAQs): What is the difference between suspending and withdrawing Social Security benefits? Suspending and withdrawing Social Security benefits are two distinct strategies. A suspension pauses future payments without repayment and is available only after reaching Full Retirement Age (FRA). A withdrawal, on the other hand, is a complete “do-over” available within 12 months of starting benefits and requires repaying all benefits received. When can you withdraw your Social Security benefits? You can withdraw your Social Security benefits within 12 months of first receiving them, regardless of your age. However, you must repay all benefits received—this includes your own payments, spousal or dependent benefits, and any withheld taxes or Medicare premiums. You may only use this option once in your lifetime. When can you suspend your Social Security benefits? You can voluntarily suspend your benefits after reaching your Full Retirement Age (currently 67 for those born in 1960 or later). During suspension, no repayments are required, and your benefits will grow by approximately 8% per year until age 70, when you can resume receiving a higher monthly benefit. Why would someone choose to suspend their Social Security payments? Common reasons include not needing the income immediately, wanting to increase future or survivor benefits, reducing taxable income, or using the pause to perform Roth conversions. Suspending benefits can also help manage future required minimum distributions (RMDs) and protect against longevity risk. How do you request to suspend or withdraw your benefits? To suspend your benefits, contact the Social Security Administration by phone, in writing, or in person. To withdraw your benefits, you must submit Form SSA-521 either by mail or in person at your local Social Security office. Once a withdrawal is approved, you have 60 days to change your mind. What happens to your benefits when you resume after suspension? When you restart benefits after a suspension, your monthly payment will include the 8% annual increase earned during the suspension period. Any future cost-of-living adjustments (COLAs) will then apply to this higher amount. Which is better — suspending or withdrawing Social Security benefits? It depends on your age and financial situation. If you’re within 12 months of starting benefits and can afford to repay the amount received, a withdrawal offers a full “reset” and restarts your benefit growth from your original start date. If you are past that window, suspension allows your benefits to grow without repayment until you choose to resume.