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About Howard Kossover

I am the Social Security Public Affairs Specialist for North Dakota and western Minnesota. Based in Grand Forks ND, I work with organizations, government agencies and businesses concerning all aspects of the Social Security programs.

Faces and Facts of Disability

This summer I wrote about Faces and Facts of Disability, a section of the Social Security website to help increase public awareness of the SSA disability program (SSDI) by providing program facts and personal stories about people receiving disability benefits. The intent of Faces and Facts of Disability is to help dispel misconceptions about the Social Security disability program and show its critical importance through personal stories of people receiving benefits.

A new video was recently added to Faces and Facts of Disability. It explains how the disability program is an insurance program that protects individuals who have paid Social Security taxes while working and explains the role of this vital social safety net in the lives of millions of severely disabled Americans. In the words of one featured beneficiary, “If I did not have Social Security, I would lose my home; I would not be able to drive; I would not be able to afford groceries.”  

Contrary to the misconception that disability beneficiaries are ”cashing in,” the average disability payment is barely enough to keep a person above the current poverty level, providing only one’s basic needs. In the month of September 2014, the average national amount to a disabled worker receiving Social Security disability was $1,145.34. My October 24 post has average amounts for other benefits for September. 

Many other facts about the Social Security disability program are in this short video including eye-opening details about people of all ages who receive disability benefits, and the critical difference these modest payments make in their lives.  

Also highlighted in the video is Social Security’s zero-tolerance policy toward fraud and the agency commitment to ensuring disability benefits are paid to the right person, in the right amount, at the right time.

The video is approximately 4 ½ minutes in length. To view it, visit www.socialsecurity.gov/disabilityfacts and click on Faces and Facts of Disability Video. 

More about Social Security disability is here.

 

 

Social Security number as tax ID

Q: When did Social Security numbers start being used for tax ID?

A: President Kennedy signed into law Public Law 87-397 on October 5, 1961. This legislation was designed to cut down on tax cheating by assigning a tax identity number to every taxpayer.

 In 1962, the Internal Revenue Service adopted the Social Security number (SSN) as its official taxpayer identification number. IRS assigns a tax number to people not eligible for a SSN. 

The Tax Reform Act of 1986, signed into law by President Reagan, required that every dependent age 5 or older listed on a tax return had to have his or her own SSN. This new requirement doubled the Social Security number workload the following year. 

Related to this, many children today receive a Social Security number (SSN) as part of their birth registration, a process called Enumeration at Birth. Starting when birth certificate information is provided at the hospital, this voluntary and free process allows the state agency issuing birth certificates to share information about the child with the Social Security Administration. A SSN is then provided to the child and mailed to the parents without any additional paperwork or cost.  

More about Social Security numbers for children is here. General information for obtaining, updating or replacing a SSN card is at www.socialsecurity.gov/ssnumber/. There is no charge for any SSN activity.

 

Average Social Security and SSI amounts in Sept. 2014

For September 2014, last month, following are three easily understood tables providing Social Security and Supplemental Security Income (SSI) information. These tables are online here

Supplemental Security Income (SSI) is a separate, low income program for the aged over 65, disabled or blind children, and disabled or blind adults that is administered by the Social Security Administration. Since SSI is completely different from Social Security, a person meeting the individual rules for each could become eligible for both programs. Income from Social Security reduces SSI amounts.

Learn more about Social Security and SSI at www.socialsecurity.gov. 

Table 1 shows the number of people, in thousands, receiving Social Security and Supplemental Security Income (SSI) divided by Social Security only, SSI only, and people receiving both. 

Table 2 shows Social Security benefit information for September 2014, separated by number of beneficiaries receiving specific types of benefits and the average dollar amount of those benefits. The number of beneficiaries is again shown in the thousands, with total benefits shown in the millions and average amounts in dollars.

The “notes” in table 1 explain differences in total Social Security beneficiaries shown between table 1 and table 2.

Social Security was never intended to provide full retirement income and this table emphasizes that fact. In September 2014, the average SSA retirement benefit, for the retiree only and excluding any family benefits, was $1,302.56.

Table 3 shows Supplemental Security Income (SSI) benefit information for September 2014, separated by number of recipients receiving specific types of benefits and the average dollar amount of those benefits. As above, the number of recipients are shown in the thousands, total benefits shown in the millions and average amounts in dollars.

In September 2014, the average SSI amount was $535.21.

These tables are online here in case you cannot read them clearly.

Social Security Announces 1.7 Percent Benefit Increase for 2015

Monthly Social Security and Supplemental Security Income (SSI) benefits for nearly 64 million Americans will increase 1.7 percent in 2015, the Social Security Administration announced today. 

The 1.7 percent cost-of-living adjustment (COLA) will begin with benefits that more than 58 million Social Security beneficiaries receive in January 2015. Increased payments to more than 8 million SSI beneficiaries will begin on December 31, 2014. The Social Security Act ties the annual COLA to the increase in the Consumer Price Index as determined by the Department of Labor’s Bureau of Labor Statistics. 

Some other changes that take effect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $118,500 from $117,000. Of the estimated 168 million workers who will pay Social Security taxes in 2015, about 10 million will pay higher taxes because of the increase in the taxable maximum.  

Information about Medicare changes for 2015 is available at www.medicare.gov 

The Social Security Act provides for how the COLA is calculated. To read more, please visit www.socialsecurity.gov/cola 

A fact sheet showing the effect of COLA related automatic changes for 2015 is here.

Using your SSA Statement

In previous posts, I have encouraged readers to create a personal my Social Security account at www.socialsecurity.gov/myaccount/. Whether or not you now receive Social Security monthly benefits, online services are there for use. To create a my Social Security account, you must be at least 18 years old, have an email address and a United States mailing address. There are no fees to do this. As of September 30, nearly 14.5 million people had opened their free my Social Security account. 

If not yet receiving ongoing benefits, the major tool available is your Social Security Statement.

Many people think only of retirement when Social Security is discussed, but, in fact, the program includes disability and survivors benefits too. Including family member benefits, retirement represents about 70 percent of national Social Security benefits, survivors about 11 percent, and disability about 19 percent.Nationally, about 18.3 percent of the entire United States population, including adults and children of all ages, receive monthly Social Security benefits. 

Of course, retirement is the desired Social Security benefit, but studies show that just over 1 in 4 of today’s 20 year-olds will become disabled before reaching age 67 and people die at all ages.   

For all of these possibilities, your Social Security Statement is a great family financial planning tool. After creating your my Social Security account, look at your Statement (sample here), especially your earnings record and estimated benefits sections, at least annually. 

Directly from your actual Social Security work record as reported by employers, your earnings record for many years is shown. This is the only place where you can see your personal earnings history. Future Social Security benefits on your record are based on your lifetime earnings. Review your record for accuracy. If there is an error, follow the correction instructions. 

Now look at the estimated benefits section. The Social Security website retirement planning section, contains tools to estimate retirement amounts but disability and survivors estimates, potentially to your children and other family members, are only on your Statement. Useful at all ages and especially for young families with dependent children, these current estimates can be a foundation for your other family financial planning. 

Creating your personal my Social Security account lets you access your Statement whenever desired. Starting for December birthdays, this past September the Social Security Administration resumed periodic mailings of paper Statements. Workers attaining ages 25, 30, 35, 40, 45, 50, 55, and 60 who are not receiving Social Security benefits and who are not registered for a my Social Security account will receive the Statement in the mail about 3 months before their birthday. After age 60, people will receive a Statement every year. The agency expects to send nearly 48 million Statements each year.

 

 

 

Boomers, Social Security and Someday

Are you a Baby Boomer?

Boomers have been filing for Social Security retirement for several years already.

On October 15, 2007, at an event hosted by Michael J. Astrue, then the Commissioner of Social Security, the nation’s first Baby Boomer, Kathleen Casey-Kirschling, filed for her Social Security retirement benefits online at www.socialsecurity.gov 

Ms. Casey-Kirschling, who was born one second after midnight on January 1, 1946, was eligible for benefits beginning January 2008 and graciously helped promote filing for Social Security retirement online. 

Here is a photo of Ms. Casey-Kirschling from that 2007 event:

Today, nationally over 50 percent of all Social Security retirement  applications are filed online. Learn how here.

Over the next 20 years, nearly 80 million Boomers will retire.

Someday, do you plan to retire? Boomer or not, Social Security should be part of your planning.

Lots of SSA retirement planning information is on the Social Security website, www.socialsecurity.gov, in the Retirement Benefits section and especially in the Retirement Planner area. Different calculators to help your planning are there including the Retirement Estimator, that connects to your own work record to provide an individual estimate.

Someday is closer than you think. Create your personal my Social Security account for additional estimates and to check your earnings record for accuracy.

Medicare Part D (Prescription Drug Coverage) Open Season & Extra Help

The Medicare Part D (prescription drug coverage) plan open enrollment period runs from October 15 to December 7.   

Review your existing Part D plan each year. A plan that previously fit your needs might not be your best choice now. You need a list of your medicines, including dosages and frequency, to compare plans.  Spouses can choose different plans.  

Social Security representatives cannot help you choose a Part D plan.  

Learn about Part D at the Medicare website, www.medicare.gov. To find a Part D plan, go to the “Find health & drug plans” section. 

Everyone currently enrolled in Medicare can purchase a Part D prescription drug plan. Unlike Medicare Part A (Hospital) or Part B (Medical), Part D plans are purchased through private insurers. You shop for the plan that best suits your needs. Joining a Medicare prescription drug plan is voluntary and participants pay an additional monthly premium for the coverage.  

Although Social Security representatives cannot help you choose a Part D plan, the agency does administer the Extra Help portion of Part D for people with limited income and resources. 

Extra Help is an income and resource based subsidy to help pay for part of monthly premiums, annual deductibles, and prescription co-payments.  

People with Medicare and receiving Supplemental Security Income (SSI) are automatically eligible for Extra Help and should not apply.   

Applying for the Part D Extra Help program does not enroll you in a prescription drug plan. 

Part D details and an application are at www.ssa.gov/medicare/prescriptionhelp/, or call the SSA national toll-free number, 1-800-772-1213 (TTY 1-800-325-0778), or your local office.

Medicare Part B premiums for 2015

Medicare Part B premiums will remain the same in 2015 as for 2014.  

As announced on October 9th by the Department of Health & Human Services (DHHS), the agency that administers Medicare, the standard 2015 Medicare Part B (Medical) premium remains unchanged from the 2014 amount of $104.90 per month. Part B covers physicians’ services, outpatient hospital services, certain home health services, durable medical equipment, and other items.  

Not everyone pays the standard Medicare Part B (Medical) premium amount. Based on the amount of their Federal tax return modified adjusted gross income (MAGI), some people pay a higher Part B premium. 

Medicare Part B premium information for 2015 is on the Medicare website, www.medicare.gov. 

The detailed DHHS press release about 2015 Medicare Part B premiums is here.

Does it matter if I retire in December or January?

Q: I am 63, work full time, and plan to retire effective either this December 31 or January 2, 2015. Is there any difference as far as how much I can earn while on Social Security either way? I may work occasionally at my present job after retiring.   

A: At age 63 there is no difference between retiring at the end of December compared to the beginning of January. Either way, you work all through December, and probably start Social Security retirement effective with January. Payment for January arrives in February.  

For the annual retirement test in any given year, how much you can earn without penalty is based on whether you will be younger than your full retirement age (FRA) the entire year, reach FRA during the year, or are older than FRA. For your birth year, FRA is 66.Since you will be younger than FRA all of 2015, the lowest retirement test limit will apply before reducing benefits. In 2014, that amount is $15,480. 

Retirement test earnings amounts for calendar year 2015 are not yet available. When announced they will be posted in the SSA retirement planner at www.socialsecurity.gov/retire2/.    

Although this person will be retired for the full 2015 calendar year, people retire all months of the year with many earning over their earnings test amounts before retiring. So that these people can start their Social Security retirement, a one-time special rule using monthly earnings, rather than calendar year earnings, is usually applied during the year that SSA retirement benefits are started.  

Annual retirement test earnings include only your own calendar year gross wages and net self-employment.

Do you work with payroll? Use SSA Business Services Online.

Are you an employer?

Do you work in a human services department?

Do you handle payroll services, whether for one business or many?  

Has your business registered to use the free Social Security Business Services Online (BSO) yet?   

Register now, then verify employee Social Security numbers online and be ready to transmit your 2014 W-2 information electronically. As long as you register in time to meet your W-2 reporting deadlines, there is not a firm BSO registration deadline. You have an extended deadline when using this electronic W-2 reporting. Register now and be ready.  

Business Services Online includes two methods to electronically file W-2s plus the Social Security number verification service (SSNVS), for online verification of employee Social Security numbers. 

To use Business Services Online, you or the appropriate people from your firm must register. Registration instructions are at www.socialsecurity.gov/employer/ in the Handbooks, Tutorial & Videos section. 

Registration is not difficult. As one of several security measures, those registering are asked for the business EIN number as well as their own name, Social Security number, and other information. A User ID and PIN is created for each person registering, not just one for the business.   

BSO provides two methods to electronically transmit W-2s. Your business can create and transmit a data file from your existing payroll software or use a Social Security provided W-2 template (W-2 Online). You can print copies suitable for distribution to employees with the SSA W-2 template. 

When you hire a new employee, use the Social Security number verification service (SSNVS) as part of your routine payroll process. Doing this avoids having incorrect employee Social Security numbers, saving your business additional work especially if the person is only a temporary hire. With SSNVS, you can immediately verify the SSN of new employees. If there is a verification problem, the new hire should contact Social Security to resolve it.  

SSNVS verifies that the employee name and provided SSN match Social Security records. It does not provide work authorization information. 

Have a question about Business Services Online? Ask.