Will there be a 2013 COLA for SSI?

Q: Will there be a 2013 cost-of-living adjustment (COLA) for SSI?

A: Yes. The October announcement about the 1.7 percent cost-of-living adjustment (COLA) for 2013 included both monthly Social Security and Supplemental Security Income (SSI) benefits. COLA changes will be in the Supplement Security Income payment received on December 31, 2012. COLA changes to Social Security will begin with benefits received in January 2013. 

Supplemental Security Income (SSI) pays benefits to disabled adults and children who have limited income and resources. SSI benefits also are payable to people 65 and older without disabilities who meet the financial limits. See SSA publication 05-11000, Supplemental Security Income for program information.

Due to the COLA increase, in 2013 the maximum Federal Supplemental Security Income amount for an individual will increase to $710 per month compared to the 2012 maximum of $698. For an eligible couple, where both wife and husband receive SSI, the 2013 maximum amount is $1,066, up from the 2012 maximum of $1,048. Individual states can add to these amounts if desired.

These are maximum Federal amounts. Including Social Security benefits, other income reduces these SSI maximums. As of October 2012, approximately 8,278,000 people of all ages received Supplemental Security Income benefits. Of this number, 2,788,000 received both Social Security and SSI.

Including all national Supplemental Security Income recipients, whether child or adult or based on disability, blindness or age, as of October 2012, the average monthly SSI payment was about $516.

Allowable Supplemental Security Income resource levels are not changing in 2013. They remain at $2,000 for an individual and $3,000 for an eligible couple.  

Details concerning what is included as income or resources for Supplemental Security Income is not changing in 2013 compared to 2012. Not all income or resources are counted for SSI purposes.  For example, the home you live in is not included.

Learn more about Supplemental Security Income at http://www.socialsecurity.gov/pgm/ssi.htm. To apply, telephone the national Social Security toll-free number, 1-800-772-1213 or TTY 1-800-325-0778, between 7:00am – 7:00pm, local time, or contact your local Social Security office.


When should you complete your retirement application?

Q: I am thinking about starting Social Security retirement in early 2013. If I do, when should I apply? 

A: Apply now if you plan to start your Social Security in early 2013. You can apply for Social Security retirement benefits when you are at least 61 years and 9 months of age and want your benefits to start in the next three months. Social Security cannot process your application if you file for benefits more than four months in advance. See the Are you ready to apply for benefits? portion of the SSA Retirement Planner.

When to file your application depends on your plans. As long as you meet all requirements and are at least age 62 throughout the entire month, you can start Social Security retirement effective with any month of the year. You do not have to start Social Security in your birthday month. There is no rule saying you must start Social Security retirement immediately upon stopping work. You might decide to delay starting benefits in favor of waiting for a higher amount. Information and calculators at the Social Security Retirement Planner will help your planning. You have choices. What is best for you?

Accessed through the retirement section of the Social Security website, www.socialsecurity.gov, the online retirement application is a popular option. Online applications represented just over 45 percent of all Social Security retirement applications received nationally from January through early November 2012. Applications completed online are reviewed, usually by your local office, and you are contacted if needed.

Unsure about using the online retirement application? The Retirement Planner section contains a video demonstration of the online application. Some of the website screens have changed since the video was created, but the process remains the same. Social Security publication 05-10523, How To Apply Online for Retirement Benefits, provides a quick overview of the online application. Both tell you information you will need, and questions to expect, even if you choose not to use the online application.

If not using the online application, make an appointment by calling the national Social Security toll-free number, 1-800-772-1213 or TTY 1-800-325-0778, between 7:00am – 7:00pm, local time. Appointments can be made for either a telephone or in-office interview. They are usually sent to local SSA offices based on zip code.

2013 Medicare Part B premium information

The Centers for Medicare and Medicaid Services (CMS) has announced that the standard 2013 Medicare Part B (Medical) premium will be $104.90 per month. Some people pay a higher premium.

The Centers for Medicare & Medicaid Services is the agency in charge of the Medicare program, even though you apply for Medicare at Social Security. 

More information about Medicare changes for 2013 is posted at http://blog.medicare.gov/2012/11/16/2013-medicare-update/.  You can reach this same information through www.medicare.gov.

The first (official) Social Security number

Last week I mentioned that the first Social Security number (SSN) card was issued, sometime in mid-November 1936, to someone whose identity and SSN are unknown.

In theory, the first card should have been issued on November 24, 1936, but the best that the Social Security Administration can say with certainty is that the first Social Security number was issued sometime in mid-November 1936. On whatever day the first card was issued, hundreds of thousands of Social Security numbers were probably issued on that same day.  

Even though when the first Social Security number was issued is unknown, there is a first official Social Security number, selected at random on December 1, 1936. As Social Security numbers were being locally assigned through the U.S. Postal Service, records were sent to Social Security headquarters in Baltimore, Maryland, where the SSN master file would be kept. 

According to the history section of the Social Security website, as part of the master file preparation in Baltimore, the Social Security number records were grouped in blocks of 1,000. The top record of the first stack became the official first Social Security number record. 

With that, the first Social Security number record, if not the actual first SSN, was established for Mr. John Sweeney, Jr., age 23 of New York State. To learn the family business, Mr. Sweeney was working as a shipping clerk for his father, a factory owner, at the time. He died before reaching retirement age, but his widow received Social Security survivors benefits through his record. 

Mr. Sweeney held the first official SSN record, not the lowest Social Security number. The lowest SSN, 001-01-0001, went to a woman in New Hampshire. 

Today when applications for Social Security benefits are processed, SSA representatives electronically compare the personal information provided on your original application for a Social Security number (SSN), as well as name or other changes, with information on your application for benefits. 

Applications for Social Security benefits were still manually processed when my responsibilities included adjudicating them. Electronic comparison of original SSN to application information was not an option. Instead, when a person applied for Social Security benefits, the local SSA representative was mailed the actual, original paper, SSN application and related changes for comparison with the benefit application.  

Given that my first clients were born in the years on either side of 1910, it is likely that I have held many of the very first Social Security number applications from November 1936. For me, that is rather neat. 

Learn Social Security history at http://www.socialsecurity.gov/history/.

Receiving Social Security? Work in 2011? Read this.

As recently as last week, several times I have mentioned that ongoing employment after retirement has the potential to increase your Social Security benefit. 

To determine if payment amounts should increase, work records of everyone receiving Social Security benefits are automatically reviewed each year that new earnings are posted to their record. 

To increase monthly Social Security benefits, your new earnings have to be higher than earnings in a year already used to compute your retirement amount. If not higher than earnings already used, new wages will not change your existing amount. Your best 35 years of gross wages and net self-employment earnings, weighted for inflation, are used to compute your Social Security retirement amount.

An initial computer run to add in new wages and self-employment earnings for 2011 has been completed. Most people who are due a benefit rate increase based upon additional earnings for 2011 or earlier will receive the increase in their Social Security benefit for November 2012. Remember that the Social Security payment for November is received in December. Related retroactive increases covering earlier months of 2012 will also be included in the benefit for November.

More than retirement benefits could be involved. For example, if a person died during 2011 or earlier in 2012, it is possible that ongoing Social Security survivors benefits on that record could increase due to 2011 earnings if they were not previously obtained.

This automatic initial computer run has identified and processed many, but not all, of the cases where an increase because of 2011 earnings is due. Individual case records requiring additional review are always present, to be processed on an ongoing basis.

Individuals receiving a benefit increase based on the addition of 2011earnings will receive a letter explaining the increase.  

Any increase from the addition of 2011 earnings is separate from the upcoming Social Security cost-of-living adjustment (COLA) increase. The 1.7 percent COLA increase will begin with benefits that more that 56 million Social Security beneficiaries receive in January 2013. Separate letters are being mailed to explain COLA related changes.  

Reminder: To receive letters about your benefits, one of your reporting responsibilities is to notify Social Security when your mailing address changes, even though your payments are electronically received by direct deposit. Social Security benefit notices are sent by surface mail through the U.S. Postal Office, not by email.

Snowbird questions about direct deposit and SSA office locations.

Q: My husband and I started receiving Social Security this summer. We plan to spend most of the winter in Arizona. Is there any need to change the bank where our benefit payments are received?  

A: In addition to security, another value of direct deposit is that your Social Security benefits arrive on time and are available immediately, whether you out of town for the day or the winter. 

There is no need to change the savings, checking or other account used for your Social Security direct deposit unless you want to. Do what is best for you.

If you choose to change bank accounts, allow up to about 60 days – approximately two checks – for benefits to be directed to the new account. This is due to computer processing times and the different Social Security payment dates during a month. A letter is sent to you by surface mail when the direct deposit bank account changes.

NOTE:  Protect yourself against identity theft. If you receive a letter about changes to your direct deposit, but have not made any changes, contact Social Security immediately.  

When changing your direct deposit, it is very important to keep the old bank account open until your benefits are actually received in the new account. 

A related topic to consider is the address you plan to use for regular mail. If desired, you can change your Social Security mailing address for letters, with or without changing the financial institution where benefits go. A mailing address change processes quickly since it involves only internal Social Security records, and not coordination with the Treasury Department as does a direct deposit change.

 Q: Also, if need arises when we are away from home, which Social Security office should we contact, our home office or the Arizona one?

A: Any Social Security office or telephone center can access your record to answer questions or make updates to your record. Within the agency, local office service areas are based on zip code but you can contact any office, or call the national telephone center. Do what is most convenient for you.

The national toll-free telephone number, 1-800-772-1213 or TTY 1-800-325-0778, connects to Social Security telephone centers across the country. Designed for high phone volume, SSA representatives are available for you to speak with between 7:00am – 7:00pm, local time.

Based on zip code, local office information is here. Expect questions to confirm your identity when speaking with any Social Security representative. 

The Social Security website, www.socialsecurity.gov, has online services for people receiving benefits and lots of program information. Linked from the homepage, the Social Security website has a frequently asked questions (FAQ) section and search engine for your use.


The first Social Security number

When was the first Social Security number (SSN) issued? No one knows. The first Social Security number could have been issued 76 years ago today.

The original Social Security Board did not yet have any field offices when, in late 1936, it contracted with the U.S. Postal Service to distribute and assign the first batch of Social Security numbers (SSN’s). The Social Security Board also enlisted the Treasury Department to assure employer cooperation.

The SSN registration process was largely directed by local postmasters. The first task for the postmen was to make up lists of employers on their routes, an effort resulting in a list of 2.4 million employers. Starting on November 16, 1936, the procedure was for post offices to ask employers how many employees they had at their place of business.  

Post offices then supplied employers an application for Social Security number (SS-5) form for each employee. Completed SS-5 forms were returned to the post office for assignment of a Social Security number and typing of the SSN card in one of approximately 1,074 post offices designated as typing center sites.

Once the Social Security number was assigned and the card typed, the local letter carrier returned the card to the place of business as a piece of regular mail. A record of the SSN assignment was sent to Social Security headquarters in Baltimore, Maryland, where the SSN master file would be kept. 

The first Social Security number card was issued, sometime in mid-November 1936, somewhere in one of the 1,074 post offices designated as a typing center, to someone whose identity and SSN are unknown.

In theory, the first card should have been issued on November 24, but there have been reports of cards showing earlier dates. About 45,000 local post offices, including the typing centers, were involved in this effort. If all correctly followed procedures, no cards could have been issued before November 16, and none should have been issued before November 24.

The best that the Social Security Administration can say with certainty is that the first Social Security number was issued sometime in mid-November 1936. On whatever day the first card was issued, hundreds of thousands of Social Security numbers were probably issued on that same day. Post Office efforts and a Social Security Board publicity campaign resulted in over 22 million completed applications as of December 22, 1936, 28 days after the initial distribution of employee applications. During the first 4 months of the registration campaign, nearly 26 million SSNs were assigned. 

Directed to “Employees of Industrial and Business Establishments,” see some of the 1936 publicity here:

Even though when the first Social Security number was issued is unknown, there is a first offical Social Security number. More about it another time.

Learn the history of Social Security at http://www.socialsecurity.gov/history/.

Is payroll tax withheld for work after retirement?

Q:  I am retired, age 67, and working the harvest for a farmer. Does he have to take out Social Security tax from my pay even though I receive Social Security? How does this affect me in the future? 

A: Yes. You pay Social Security and Medicare taxes on work or self-employment earnings, regardless of age or whether already receiving Social Security benefits.  

Your new earnings can increase future benefits if they are higher than the earnings in a year already used to compute your retirement amount. If not higher, new wages will not change your existing amount.   

Work records of everyone receiving Social Security benefits are automatically reviewed each year that new earnings are posted to their record.

Social Security webinar: Frequently Asked Questions

The Social Security Administration field office organization includes ten regions. The Denver Region, where I am, directly serves residents of Colorado, Montana, North Dakota, South Dakota, Wyoming, Utah, western Minnesota and three Canadian provinces.  

You might find a recent Denver Region webcast titled Social Security Frequently Asked Questionsinteresting. 

Those of us who teach about the Social Security programs are frequently asked certain topics and questions. This free webcast answers some of them. In approximately 20 minutes, the webinar discusses Social Security retirement, survivors and disability program topics, how benefit amounts are determined for individuals and spouses, how to replace a Social Security card, and more.  

So that you can easily find information for yourself, the webinar also highlights the Frequently Asked Questions (FAQs) area of the Social Security website, www.socialsecurity.gov

I hope you find Social Security Frequently Asked Questionsinteresting.  If so, please share it with others.

Social Security 2013 annual earnings test

In 2013, how much can you earn before Social Security retirement benefits are reduced?  

The annual earnings test, also known as the retirement test, concerns how your own employment earnings in a year affect your Social Security retirement, or other Social Security benefits, payable in that year. The earnings test includes only your personal gross wages or net self-employment for the full calendar year. Your other income, or income of a spouse, is not included.  

Three annual earnings levels exist, all based on your full retirement age (FRA).  If born in1943-1954, full retirement age is 66. Learn your FRA at http://www.socialsecurity.gov/retire2/.  

Earnings test amounts for calendar year 2013 are changed from 2012. They are:  

  • If under full retirement age (FRA) for the entire calendar year, $1 in benefits will be deducted for each $2 earned above the 2013 limit of $15,120.
  • If you reach FRA in 2013, $1 in benefits will be deducted from each $3 earned above the 2013 limit of $40,080, but only for earnings before the month you reach FRA.
  • No earnings limit exists starting with the month you reach full retirement age.

Do you plan to start Social Security retirement in 2013? Often people retiring mid-year have already earned over the annual limit for their age. To allow the start of Social Security retirement regardless of expected calendar year earnings, there is a special one-time rule based on monthly earnings. This rule applies for one year, usually the first year of retirement, and lets people receive Social Security payments for months that they are retired.

For example, a person retiring in 2013, at least age 62 but younger than full retirement age the entire year, can receive retirement for months that gross wages do not exceed $1,260 even though calendar year earnings will be above retirement test amounts. Similar rules apply for self-employment. 

Learn about the earnings test at http://www.socialsecurity.gov/retire2/whileworking.htm. At present, 2012 information is there, but this is where 2013 earnings test information will be located. Earnings test amounts for 2013 are included with changes related to the 2013 cost-of-living-adjustment (COLA) at http://www.socialsecurity.gov/pressoffice/factsheets/colafacts2013.htm.

More about the special, one-time, monthly test is at http://www.socialsecurity.gov/retire2/rule.htm

The earnings test does not apply to people receiving SSA benefits due to their own disability. If receiving benefits due to your own disability, contact Social Security before starting to work.