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Yahoo
14-05-2025
- Health
- Yahoo
Social Security Disability rules after age 55
If you are 55 or older, you might not consider yourself a person of advanced age. But your age could help you qualify for Social Security Disability Insurance (SSDI) benefits if you can no longer work. To receive SSDI benefits, you must show that you have an injury or illness that makes you unable to work for a living. In many cases, an applicant's age of 55 and older is one of the factors considered in a disability claim. As you get older, the Social Security Administration (SSA) is more likely to accept your inability to work, Morgan, Collins, Yeast & Salyer notes. The SSA's Medical-Vocational Guidelines, or "Grid Rules," can be helpful if you are disabled and of a certain age. The majority of applications for SSDI benefits are denied initially. But if you are over 55 and have been denied SSDI, there may be age-related considerations for SSDI eligibility that apply. If you are injured or ill and can no longer work for a living, you may be eligible for Social Security Disability Insurance benefits. SSDI benefits replace a portion of income lost as a result of being unable to work. First, you must have a work history to qualify for SSDI benefits. SSDI is primarily funded by Federal Insurance Contributions Act (FICA) paycheck deductions. Individuals whose disability has prevented them from ever working and who do not have a work history may be eligible for a different disability benefit, Supplemental Security Income (SSI). The Social Security Administration defines disability as: You cannot perform your old job. You cannot perform another type of gainful employment or your skillset does not transfer to another job. Your disability prevents you from working for at least a year or is expected to cause your death. The Social Security Administration uses two methods to determine whether an applicant is disabled. If an applicant's condition matches the criteria outlined in the SSA's Listing of Impairments, the applicant automatically qualifies for disability benefits. The Listing of Impairments describes impairments for each major body system that are considered severe enough to prevent an individual from performing any gainful work. The Listing of Impairments is also known as "The Blue Book." If an SSDI applicant's medical condition cannot be matched to a Blue Book impairment, SSA examiners must decide whether the condition is of equal severity to a listed condition. The examiners must also decide whether the applicant can perform their previous job or any other available job they are trained to do. When an applicant is 55 years old or older, the SSA also considers its Medical-Vocational Guidelines. These guidelines consider various vocational factors, such as age, education, and work experience, in combination with the applicant's residual functional capacity (RFC) to evaluate the applicant's ability to engage in substantial gainful employment. The Medical-Vocational Guidelines include grids that apply an applicant's functional capacity to their capability for sedentary, light, medium, heavy, or very heavy work. When determining whether a disability applicant can perform substantial gainful activity, one factor considered alongside medical condition is age. The SSA considers advancing age to be an increasingly limiting factor that affects a person's ability to adjust to different work. The SSA's age categories and how they are applied are: Younger person (under age 50). At this age, the SSA generally does not consider that the applicant's age affects their ability to adjust to other work. Closely approaching advanced age (age 50–54). SSA will consider that the applicant's age along with a severe impairment and limited work experience may seriously affect their ability to adjust to other work. Person closely approaching retirement age (age 55 or older). The SSA believes advanced age significantly affects a person's ability to adjust to other basic work-related activities. For example, for an applicant of advanced age who has a severe impairment that limits them to no more than sedentary work, the SSA may find that the applicant has transferable skills to skilled work or semiskilled work only if the sedentary work is similar to previous work and requires little or no vocational adjustment in terms of tools, work processes, work settings, or the industry. The SSA is more skeptical of an applicant's ability to transfer job skills to different work when the worker is 60 or older. The upshot of the SSA's consideration of age is that if you are over 55 when you apply for SSDI, it is more likely that the SSA will decide you cannot perform work that you have not recently done. With the help of a Social Security Disability attorney, you may have a better chance of qualifying for Social Security Disability benefits. When filing a Social Security Disability Insurance claim, you need to present detailed medical records that show you are totally disabled. If you do not have a diagnosis that matches a condition on the SSA's Listing of Impairments, your records need to detail your symptoms and treatment and the physical limitations your condition has caused you. In addition to documenting your disability, you will need to document your work history before you became disabled and provide employer information. An application requires several forms, including one to allow doctors, hospitals, and other healthcare professionals who have treated you to send medical evidence to the SSA. Social Security Disability lawyer can prepare an SSDI benefits application on your behalf and help you navigate Social Security Disability rules. This story was produced by Morgan, Collins, Yeast & Salyer and reviewed and distributed by Stacker.
Epoch Times
29-04-2025
- Business
- Epoch Times
Cracking the Code: Understanding Social Security and Maximizing Your Benefits
Social Security is a phrase often used in retirement planning and has been discussed in the media recently. For many, though, it remains a mystery. It provides income, but how does it really work? Further, it's easy to become overwhelmed by countless claims, strategies, and confusing terminology. This post, however, will help you navigate Social Security's complexities, maximize your benefits, and secure a more comfortable retirement. What Exactly Is Social Security? Imagine a safety net made up of generations of hardworking Americans. That's what Social Security is all about. The program was While working, you and your employer contribute 6.2 percent of your wage through the Federal Insurance Contributions Act (FICA). In turn, the Social Security Trust Fund benefits current beneficiaries. In a sense, today's workers are supporting yesterday's retirees. Decoding the Benefit Calculation Social Security checks don't appear out of nowhere. The amount is calculated based on your lifetime earnings. As a simplified breakdown, here is what you need to know. Your earnings history determines Social Security retirement benefits. To calculate your benefit, the Social Security Administration (SSA) uses the following formula: Your highest 35 years of earnings (adjusted for inflation) Your age at the time you begin claiming Your full retirement age For your information, based on the 2024 edition of the Full Retirement Age (FRA) A person's FRA is the age at which they can receive 100 percent of their Social Security benefit. Depending on your birth year, it may be: The FRA for those born between 1943 and 1954 is 66. Those born between 1955 and 1959 will see an increase in FRA. If you were born in 1960 or later, your FRA is 67. You can start claiming at age 62 but must accept a 30 percent reduction. Alternatively, you can delay benefits past your FRA and increase your monthly payment up to 70 years of age. The Million-Dollar Question: When Should You Claim? Here is where 'strategy' comes in. There is no one-size-fits-all solution. In each case, it varies: Claiming early (Age 62–FRA). Pros: You get to access your income sooner. This is a great option if you need the money or want to retire early. Cons: It is possible to have your benefits permanently reduced by up to 30 percent. In addition, your spouse will receive lower survivor benefits as a result. Claiming at FRA. Pros: The benefit you receive is full and unreduced. This is a good middle ground for many people. Cons: If you delay, you lose out on the extra boost. Delaying Until 70. Pros: Your benefit increases by 8 percent every year you delay past FRA up to age 70. Over your lifetime, this can amount to a substantial sum. Cons: It takes longer for your income to arrive. As such, you might not 'break-even' if you don't live a long life. Making Sense of the Break-Even Point In Social Security discussions, the term 'break-even' is often used. It means the benefits you receive from delaying exceed those you would have received from claiming earlier. If you expect to live well into your 80s or beyond, delaying benefits can be beneficial financially. Strategies to Maximize Your Benefits Time isn't everything; it's all about playing the long game. Work at Least 35 Years With fewer than 35 years of income under your belt, zero-income years are included in your benefit calculation, reducing it. Replacing low-earning years from your early career with part-time work later in life may even be possible. Boost Your Earnings You'll receive more benefits if you earn more (especially during years of higher wages). An individual's lifetime earnings are affected by income from raises, promotions, side gigs, and self-employment. Strategic Delaying In addition to delaying your benefits beyond your FRA, you may also be able to increase your monthly check considerably. This is particularly useful for those with longer life expectancies and families that have a long lifespan. Spousal Coordination To boost household income, married couples can use several strategies: Spousal benefit . At FRA, a spouse can receive up to 50 percent of the other's benefits, even if they didn't work much. Claim and suspend . While one spouse receives a spousal benefit, the other claims their own benefit at FRA. Survivor benefits . After turning 60, widows and widowers can switch from survivor benefits to their own higher benefits. Increase Your Tax Awareness Up to 85 percent of your Social Security benefits may be taxable, depending on your other sources of income (pension, withdrawals from retirement accounts, etc.). You can minimize your tax burden if your income does not exceed certain thresholds. As of 2025, the basic thresholds are as follows: Single filers . An income over $25,000 may be subject to partial taxation. Joint filers . If your income exceeds $32,000, your benefits will be taxed. Conduct an Earnings Test If you claim benefits before FRA and continue to work, the Social Security Administration may temporarily withhold part of your benefit. As an example, if you are under the FRA in 2025, you lose $1 for every $2 you earn over $22,320. Although the money isn't lost, it can affect short-term cash flow because it will be added back to your benefits later. Use Online Tools The SSA's website ( has calculators and access to your Social Security Statement. By regularly checking your statement, you can ensure that your earnings record and benefits are also accurate. Be Aware of Special Situations Divorced individuals. It may be possible to claim benefits based on your ex-spouse's record if you were married for more than ten years. Survivors. Benefits may be available to survivors' spouses and minor children. Public employees. The Windfall Elimination Provision (WEP) or Government Pension Offset (GPO) can reduce the benefits of some government workers. Debunking Common Social Security Myths Let's debunk some of the most common myths to help you better understand this vital part of your financial future. 'The Social Security System Is in Financial Trouble' This is a big one, and it causes unnecessary worry. It is not likely that Social Security will disappear overnight. It is a pay-as-you-go system: you and your employer contribute to FICA taxes, but that money primarily pays current benefits. Social Security indeed faces some financial challenges. Historically, the system has collected more than it has paid out, accumulating a nice surplus. The tide is turning, however. With more people retiring and living longer, more benefits are being paid out than taxes are being collected. Related Stories 4/26/2025 4/25/2025 The key takeaway is this: without changes, the surplus will disappear Another way to think of it is like your car running low on gas. While it won't stop working immediately, you'll have to refuel soon. This is where Congress comes in. As they did in 1983, they will need to make adjustments. Among those adjustments could be raising the retirement age, raising taxes, or taxing benefits differently. 'Social Security Benefits Must Be Claimed by Age 62' Many people make potentially costly decisions because of this myth. Yes, 62 is the earliest you can claim benefits. However, it is not required. You will receive your full, unreduced pension when you reach your 'full retirement age' (FRA). Your FRA depends on your birth year; if you were born after 1960, your FRA is 67. At 62, you can claim early and get a permanent reduction in your monthly payments. For example, claiming benefits at 62 could mean a 30 percent reduction in monthly income if your FRA is 67. Even if you plan to live a long retirement life, that's a significant sum. On the flip side, if you can hold off until age 70, you'll get a 'bonus' of about 8 percent more per year for each year you delay claiming your FRA. In other words, if your FRA is 67 and you wait until 70, your monthly income will increase by 24 percent. If you wait from 62 to 70, your income will increase by 77 percent. 'Retirement Income Will Be Derived Mainly From Social Security' Although Social Security is an important part of your retirement plan, it usually isn't enough to live comfortably. The purpose of this is to supplement your income, not to be your sole source. Think of it as one piece of a puzzle. To maintain your desired lifestyle, you'll probably need other sources of income, such as savings, investments, or pensions. With the help of a financial advisor, you can prepare a comprehensive income plan that includes Social Security and other sources of income. 'Guaranteed Colas Are Available Every Year' Your benefits are adjusted for inflation through the cost-of-living adjustment (COLA). The Consumer Price Index for Urban Wage Earners and Clerical Workers However, there is no guarantee that there will be a COLA every year. If there is no significant inflation, there will be no adjustment. The same thing happened in 2010, 2011, and 2016. Fortunately, the COLA process is automatic. As such, Congress does not need to vote every year. 'There Is No Way You Can Get All the Money Back You Put Into the Program' This will differ depending on your circumstances, especially how long you live. As a safety net, Social Security provides a guaranteed lifetime income. Inflation-protected Social Security income provides inflation-free income for life, unlike FICA. Whether you live to 100 or beyond, you'll keep receiving payments. In addition, if you pass away before your spouse, they may be eligible for survivor benefits. 'A Person Can Outlive Their Social Security Benefits' This is simply not true. You will receive payments every month until you die. It is a federally backed, inflation-indexed, guaranteed income stream. 'For Other Programs, the Government Raids Social Security' Unlike the government's general fund, the Social Security trust fund is separate from it. Nevertheless, the government borrows from Social Security. As with other government bonds, tax revenue is invested in Treasury securities. There is no limit to how the government can use the money, but it must repay it with interest. Despite the appearance that the government is stealing from Social Security, they always repay the money, and the interest increases Social Security's assets. 'After Reaching Full Retirement Age, You Can Claim Early and Get a Bump Up' This is a common misconception. As soon as you start receiving benefits, the amount is fixed. Your FRA benefit does not increase automatically. You can, however, suspend your benefits after reaching your FRA and restart them later. As a result, your benefits will increase by 8 percent every year you delay. It's also possible to cancel your benefits within the first 12 months, repay the benefits you've received, and then claim again later. However, you can only do this once. 'Social Security Benefits Are Tax-Free' Before 1984, this was true. Benefits may now be taxed up to 85 percent, depending on your income. Depending on your overall income, you will be taxed on your benefits. The Long-Term View In retirement, Social Security is a crucial piece of the puzzle. Having a thorough understanding of it is essential for making informed decisions. Prepare for the future by running the numbers, consulting a financial advisor, and planning for the long-term. The views and opinions expressed are those of the authors. They are meant for general informational purposes only and should not be construed or interpreted as a recommendation or solicitation. The Epoch Times does not provide investment, tax, legal, financial planning, estate planning, or any other personal finance advice. The Epoch Times holds no liability for the accuracy or timeliness of the information provided.
USA Today
04-04-2025
- Business
- USA Today
Everyone wants a tax break. Here are six creative ways some Americans have gotten them.
Everyone wants a tax break. Here are six creative ways some Americans have gotten them. Show Caption Hide Caption FICA explained: What to know about Social Security, Medicare tax rates FICA, the Federal Insurance Contributions Act, is the federal payroll tax. Here's what taxpayers need to know. Everyone's always trying to pay less tax, hunting for as many tax deductions as possible to cut their tax bill. Most Americans know charitable gifts, retirement contributions, student loan and mortgage interest are tax-deductible, but like kids, some taxpayers will test the limits to see what else the IRS will allow. Americans may be surprised by what the IRS has let squeak by. Over the years, the IRS has allowed some unusual tax deductions, but the circumstances were very specific. Basically, taxpayers must prove the items were necessary or a legitimate business expense. They can't be personal expenses. Here are examples of extraordinary deductions taxpayers have asked for and received from the IRS. It's important to note that even though these were approved, accountants recommend you consult with a professional before pursuing any offbeat deductions. Baby oil Most Americans can't take a tax deduction for baby oil but what if it's necessary for your work? In 1984, the Tax Court ruled a professional bodybuilder who used body oil to make his muscles glisten in the lights during his competitions could deduct the cost of the oil as a business expense. However, the Court declined tax deductions for buffalo meat and special vitamin supplements to enhance strength and muscle development, according to TurboTax. Breast implants Cosmetic surgery is usually a personal expense and isn't tax-deductible. In 1994, however, self-employed exotic dancer Cynthia Hess (aka Chesty Love) won her tax case allowing her breast implants in 1988 to be considered a legitimate business expense and could, therefore, have the cost be deducted. She argued that they were necessary to earn a living and that she otherwise wouldn't have enlarged her breasts 'to such an extent that they made her appear 'freakish.'' The court decided the breast implants satisfied a two-part test: (1) required as a condition of employment and (2) unsuitable for everyday use. The breasts were analogous to a 'costume,' necessary for her job to make money, and because of how large they were, they were unsuitable for everyday use but unable to be removed daily. A trip to the Caribbean Business in the sun can be tax deductible! Conventions in many Caribbean islands as well as Mexico and Canada are deductible without having to show that there was a special reason for the meeting to be held there, TurboTax said. Caribbean islands that get special tax treatment include Bermuda, Barbados, Costa Rica, Dominica, the Dominican Republic, Grenada, Guyana, Honduras, Jamaica, and Trinidad and Tobago. Favorable tax treatment doesn't apply anywhere else in the world unless you show why the meeting had to be held there, TurboTax said. Private jet John and Joanna French won their case in 1990 to write off their private jet on their 1984 taxes. They argued that they used it to fly from their home in San Jose, California to manage, advertise and rent their condo in Mammoth Lakes, California, instead of driving 5½ to 7½ hours each time. They argued that because the two worked full time, it was reasonable for them to use a private jet to fly there to use their time efficiently rather than rely on the one commercial flight a day to Mammoth Lakes. The IRS argued that Mammoth Lakes was a vacation destination, and these trips were personal expenses. Ultimately, the court decided that given the circumstances, and if the Frenches were flying there to personally manage their condo, the expense was reasonable and therefore, tax deductible. Pets If you just have pets "around to love on and spend time with, even if you feature them in a social media post, that animal wouldn't be an eligible tax deduction,' said Catherine Kauffelt, head of tax compliance at Collective, an online back-office platform service. That includes emotional support animals, which aren't considered service animals because they're not specifically trained to support a condition. But there are some instances when pet-related deductions can be allowed: In 1995, scrap yard owner Samuel Seawright won a $300 deduction for cat food by arguing he had to set out cat food to attract wild felines to prevent snakes and rats from entering his scrap yard. The key here is that it was used for his business. In 2011, Jan Elizabeth Van Dusen won a $100 deduction for expenses related to fostering a cat. The expenses qualified as unreimbursed expenditures for services to a charitable organization, the court ruled. Note, however, that expenses of $250 or more would need written acknowledgement from the charity. If you're in the military, you can deduct the cost of moving your personal items to a new home, and household pets are treated the same as your other personal property, the IRS says. Expenses related to service animals may be deductible as medical expenses, the IRS says. Unbelievable: Cat food and tanning oil? 6 outrageous tax deductions the IRS approved Swimming pools and other health aids If you just want to go to a gym to get some exercise or stay in generally good health, your membership won't be deductible. But if your doctor prescribes something 'to alleviate or prevent a physical or mental disability or illness,' you might be eligible for a tax break, the IRS says. That 'something' can be a swimming pool, for example, if you need hydrotherapy to treat a condition. Medora Lee is a money, markets and personal finance reporter at USA TODAY. You can reach her at mjlee@ and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning.
Yahoo
27-02-2025
- Yahoo
Shelbyville woman pleads guilty to tax, wire fraud; will pay more than $1.1M in restitution
NASHVILLE, Tenn. (WKRN) — A Bedford County woman has pleaded guilty to financial crimes and will pay more than $1 million in restitution, according to the U.S. Department of Justice (DOJ). The DOJ announced 33-year-old Rebekah Proctor, of Shelbyville, pleaded guilty to one count of willful failure to collect, account for and pay over a tax and one count of wire fraud. She will be sentenced in July, but the DOJ said Proctor faces up to 30 years of imprisonment for the wire fraud charge and up to five years for the tax offense. According to the plea agreement filed, Proctor operated Franklin Springs Academy, a daycare business in Middle Tennessee. Although she withheld income taxes and Federal Insurance Contributions Act (FICA) taxes — commonly known as Social Security and Medicare taxes — from her employees' paychecks and additionally owed the employer's portion of the FICA taxes, Proctor 'willfully failed to truthfully account for and pay such taxes to the IRS for the first quarter of 2022.' For that quarter alone, the DOJ said Proctor owned tens of thousands of dollars in unpaid taxes. She also fraudulently applied for and received a COVID-relief Paycheck Protection Program (PPP) loan she was not entitled to receive. The DOJ said Proctor made several false certifications on her April 4, 2020, application for more than $100,000 in PPP funds, including that she was current on her federal tax obligations and that the loan funds would be used to retain workers and for other business expenses. In fact, Proctor used the funds for her own personal expenses and for her husband's personal expenses, according to the DOJ. ⏩ As set forth in the plea agreement, Proctor agreed that the restitution owed to the IRS for her employment taxes is $893,232.26. This figure includes unpaid taxes plus penalties and interest as required by law. She further agreed that restitution owed to the Small Business Association is $223,800, which is made up of the $105,800 in PPP loan proceeds she received in April 2020, as well as $118,000 in addition fraudulently obtained PPP loan proceeds she received in February 2021. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
19-02-2025
- Business
- Yahoo
What are OASDI taxes? They help fund your retirement
(NewsNation) — You may have noticed some alphabet soup on your pay stub, with the acronyms FICA and OASDI. But what are they, and how do they affect your bottom line? FICA stands for the Federal Insurance Contributions Act and reflects the federal payroll taxes deducted from your earnings. Specifically, workers pay into Medicare and OASDI, or Old-Age, Survivors, and Disability Insurance (more commonly known as Social Security). Filing taxes late will cost you, but how much? If you work full-time for a company, you pay 6.2% for OASDI and your employer matches that amount. If you're self-employed and make more than $400, you are on the hook for the entire 12.4%. After paying in, workers ultimately draw Social Security benefits when they retire. Some individuals may be eligible to draw benefits for a disability. There is a notable exception to Social Security taxes. Public employees with qualifying pensions are not subject to OASDI because they will draw retirement income from their own systems. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
