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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.

First SSA benefit different from first payment

On January 31, 1940, the first monthly recurring Social Security retirement check was issued, going to Ida May Fuller of Ludlow, Vermont.

Born in 1874, Ida May Fuller worked as a schoolteacher before becoming a legal secretary in 1905. Never married, she worked for about three years under the Social Security program before retiring in 1939 and starting her Social Security retirement at age 65 in January 1940. 

She was the first beneficiary of recurring monthly Social Security payments. Her retirement amount was $22.54 per month and, at that time, cost-of-living adjustments (COLAs) did not yet exist. 

Ms. Fuller lived to be 100 years old, dying in 1975 with a secure place in Social Security history. Here is an October 1950 photo of Ms. Fuller:

However, while Ms. Fuller received the first monthly recurring Social Security benefit, she did not receive the first Social Security payment. That distinction is credited to Ernest Ackerman of Cleveland, Ohio.

As noted in the history section of the Social Security website, “From 1937 until 1940 Social Security paid benefits in the form of a single, lump-sum payment. The purpose of these one-time payments was to provide some “payback” to those people who contributed to the program but would not participate long enough to be vested for monthly benefits.  … The earliest reported applicant for a lump-sum benefit was a retired Cleveland motorman named Ernest Ackerman, who retired one day after the Social Security program began. During his one day of participation in the program, a nickel was withheld from Mr. Ackerman’s pay for Social Security, and, upon retiring, he received a lump-sum payment of 17 cents.”  Here is an undated photo of Mr. Ackerman:Information today is from the History section of the Social Security website and, in particular, from the “Historical Development of Economic Insurance” section.

 

 

Benefits from first spouse if no longer married to second

Q: I am married for the second time and receive my own Social Security retirement. My first husband and I were married for 18 years and he earned lots more money than I did. If I was single again, could I draw Social Security from my first husband? 

A: The answer to this question could go in several directions depending on the amount of the person’s own retirement, other benefits received, if the marriages ended by death or divorce, and other items. Without more information, this question cannot be answered.  

The Social Security website, www.socialsecurity.gov, is great for general information, retirement planning and online services, including online applications, but when you have a detailed question such as this one, speak to a SSA representative to discuss your options. Having the Social Security number of all parties involved would be useful. Call the SSA national toll-free number at 1-800-772-1213 (TTY 1-800-325-0778) (7:00am – 7:00pm) or your local office 

Based on age, a widow or widower can start receiving Social Security survivors benefits as early as age 60. Remarriage before age 60 prevents payment. Remarriage after age 60 (for age based benefits) will not affect eligibility to survivors benefits. If twice widowed, benefits might be payable through the work record of either deceased spouse or the person’s own retirement work record. 

Survivor benefits might also be payable to the divorced spouse of a deceased worker if the marriage had lasted 10 years or more. 

More about Social Security survivors benefits is here. 

The original question did not specify that the first husband had died. If the couple had divorced, benefits to her through his work record might be payable since they were married at least 10 years, if she was not married. Information about benefits for divorced spouses is here. 

If the second marriage continues, there is the potential for spousal benefits.

SSA Statements – in the mail or online

Last September the Social Security Administration announced the resumption of mailed Social Security Statements. The first ones went to people of specified ages having a December birthday.

Most people will not receive a mailed Statement every year. You will receive yours when reaching ages 25, 30, 35, 40, 45, 50, 55, and 60 if not receiving Social Security benefits and if not registered for a my Social Security account.

The Statement will arrive in the mail about 3 months before your birthday. After age 60, people will receive a Statement every year. The agency expects to send nearly 48 million Statements each year. 

The Statement is a great family financial planning tool at all ages up to retirement, especially for people with young families and years away from retirement. Social Security is more than retirement. The Statement includes estimates for disability and survivors benefits also. My post of October 20, 2014, discussed using the Statement to estimate family benefits and to check your work record for accuracy.

Information on the Statement is so important that it is far better to see yours more often than every five years. And you can. Online. Whenever you want.

Do so by creating your personal my Social Security account at www.socialsecurity.gov/myaccount/. View your own Statement online at least once a year or as often as you want. Doing this will help you plan for your Someday retirement and for your Today.

 

Recently change your name?

Recently change your name?

Is your name the same on your W-2 form as on your Social Security number (SSN) card? 

If you need to update your name on your Social Security card, remember that doing so is free. Social Security does not charge a fee for Social Security number actions whether name change, replacement of a lost card or issuing an original number.  

See the Numbers & Cards section at www.socialsecurity.gov for needed evidence and a downloadable application. The direct link is www.socialsecurity.gov/ssnumber. An easy to use decision tree provides instructions.

To protect your personal information and avoid identity theft, you cannot electronically submit the Social Security number application. While a few areas of the country have centralized sites to process SSN card actions, in North Dakota completed applications, with evidence, can be brought or mailed to a local office. Locations for other areas are part of the decision tree instructions in the Numbers & Cards section. 

To speed your request, be sure to read instructions and have needed information available. Local offices routinely see people who do not have what they need. Unfortunately, they must be sent away wasting their time and ours.

It is important that any document submitted as evidence must be an original or a copy certified by the issuing agency. Photocopies you made yourself or that you had notarized cannot be used. State agency addresses if you need a certified copy of a document showing a birth, marriage or divorce within the United States are linked from the website. All documents are returned to you.

SSN cards are mailed from a central location when processing is complete. Allow approximately two weeks to receive your corrected or replacement card.

The name on your card should be the same as reported by your employer so that your wages are correctly shown on your work record. Have your employer correct your payroll record after your SSN card is updated. Employers can verify the SSN of employees and transmit W-2 data with the free SSA Business Services Online at www.socialsecurity.gov/thirdparty/business.html

Warning: Be careful when searching the Internet for Social Security information. Avoid private for-profit websites that charge for services provided free by Social Security, including name changes to your SSN card. Go to www.socialsecurity.gov or www.ssa.gov for accurate information and free services.  

 

 

Is there still a Social Security funeral benefit?

Q: Does Social Security still pay a funeral benefit? A friend said that none was payable when his grandmother recently died.

A: You are referring to the Lump Sum Death Benefit (LSDP) and, yes, it still exists when specific requirements are met.  

The Lump Sum Death Benefit (LSDP) is a one-time payment of $255 to help offset funeral costs. While this is a small amount towards a funeral today, the payment dates back many years to when that amount covered a more significant portion of costs. 

The benefit is payable only on the record of someone with insured status, meaning she or he had enough work for benefits to be payable on their record. Even then, the LSDP is payable to a limited group. 

When the deceased had enough work, the LSDP can first be paid to the surviving spouse if they were living in the same household at time of death, although exceptions exist.

If no spouse survives, the LSDP can be paid to a child if he or she was eligible for benefits based on the work record of the deceased for the month of death. 

Lump Sum Death Benefit (LSDP) examples:

  1. The deceased was receiving her or his own SSA retirement and lived with their husband or wife. The surviving spouse can receive the Lump Sum Death Benefit (LSDP).
  2. The deceased was eligible for Social Security as a spouse or widow / widower but not eligible based on their own work record.  A LSDP is not payable.
  3. The deceased received their own SSA retirement, has no surviving spouse but did have an adult disabled child receiving through her or his record. The surviving child can receive the LSDP because they were already receiving benefits from the parent’s record.
  4. The deceased received their own SSA retirement, has no surviving spouse but has grown children, none of whom receives Social Security child benefits. A LSDP is not payable.  

The LSDP is separate from ongoing Social Security survivor benefits 

Always contact Social Security when there is a death in the family. The SSA representative can discuss potential benefits, whether for now or the future, be sure that ongoing benefits are properly ended and answer questions.

When will 1099’s for 2014 be mailed?

The new year always brings questions about taxation of Social Security benefits and receipt of 1099’s.

Earlier this week, I wrote about when people might have to pay federal income taxes on their Social Security benefits. No one pays federal income tax on more than 85 percent of his or her Social Security benefits based on Internal Revenue Service (IRS) rules. 

The SSA-1099 for Tax Year 2014 will be mailed by January 31, 2015.  

Referring to my post of January 5, these are sent to your mailing address as shown on Social Security records so I hope yours is correct. 

You can request a replacement SSA-1099 for Tax Year 2014 on or after February 1, 2015. 

If you need a replacement SSA-1099 for Tax Year 2013 or earlier, see instructions here.

Do I pay income tax on my Social Security benefits?

Q: Do I pay income tax on my Social Security benefits? 

A: Perhaps. Here is information from the Social Security website, www.socialsecurity.gov. Including links to IRS information, more details are at www.socialsecurity.gov/planners/taxes.htm 

Some people have to pay federal income taxes on their Social Security benefits. This usually happens only if you have other substantial income (such as wages, self-employment, interest, dividends and other taxable income that must be reported on your tax return) in addition to your benefits. 

No one pays federal income tax on more than 85 percent of his or her Social Security benefits based on Internal Revenue Service (IRS) rules. 

If you file a federal tax return as an “individual” and your combined income is

·  between $25,000 and $34,000, you may have to pay income tax on up to 50 percent of your benefits.

·  more than $34,000, up to 85 percent of your benefits may be taxable. 

If you file a joint return, and you and your spouse have a combined income that is

·  between $32,000 and $44,000, you may have to pay income tax on up to 50 percent of your benefits

·  more than $44,000, up to 85 percent of your benefits may be taxable. 

If you are married and file a separate tax return, you probably will pay taxes on your benefits.

 

Is payroll tax withheld if I work and receive Social Security?

Q: I stopped working full-time at the end of 2014 and started Social Security retirement. For the next few months I will work part-time and then retire completely.

Will Social Security payroll tax be held from my paycheck? If yes, will this increase my retirement amount? 

A: Yes, you continue to pay Social Security and Medicare payroll taxes. Your employer will continue doing so too. Everyone working in employment or self-employment covered by Social Security must pay payroll taxes regardless of age or eligibility to Social Security benefits. Current and historical Social Security and Medicare tax rates are shown here. 

If you are younger than full retirement age, remember annual earnings test limits.

Your new earnings would have to be better than the ones already used to compute your retirement amount to increase your monthly retirement amount. While possible, it is doubtful that a few months of part-time work will change your monthly retirement amount since the best 35 years of your working career are used.  

Benefit amounts of everyone receiving Social Security benefits are automatically reviewed when new earnings are posted to their work record even when low earnings are involved. Due to this, your retirement amount will be automatically reviewed once these 2015 earnings appear on your work record. 

Since you worked full-time all of 2014, it is much more likely that your 2014 earnings will increase your retirement amount when automatically reviewed. 

Employers report your earnings to the Social Security Administration as part of the W-2 process. Different employer deadlines apply based on how reporting is completed. Employers have a March 31 deadline if electronically reporting 2014 W-2 information using Social Security Business Services Online (BSO). If reporting by paper, the deadline is the last day of February.

However reported, national posting of all wage information is usually complete in approximately October, with automatic reviews of benefit amounts starting once wage posting is complete. If 2014 earnings increase retirement benefits, you will receive the increase in approximately December 2015, with payment retroactive to January 2015. 

 

Receiving Social Security? Have you moved?

When benefit amounts change for a person receiving either Social Security or Supplemental Security Income (SSI), a letter is sent by regular Post Office mail telling the new amount and reasons for the change. 

As routinely done, recently the Social Security Administration has been mailing letters to beneficiaries explaining the 2015 cost-of-living increase benefit changes. Many of those letters cannot be delivered because Social Security records had an old address and Post Office mail forwarding requests were either not done or had expired.

One result is that the people involved do not receive important benefit information sent to them unless they contact Social Security to ask about it. These recontacts create more work for both the person and Social Security representatives. 

Have you moved this year while receiving either Social Security or SSI benefits? Did you report your new mailing address so that your records stay accurate? If not, do this now. 

Update your address in several ways.  

Online: Social Security beneficiaries can update their address online at any convenient time if they have a personal my Social Security account. SSI recipients cannot update their address this way but other my Social Security services such as getting an online letter to prove your benefit amount remain available. For your convenience, this is the suggested method. Create your my Social Security account at www.socialsecurity.gov/myaccount/.

By phone: you can telephone the Social Security national toll-free number, 1-800-772-1213 / TTY 1-800-325-0778, from 7:00am – 7:00pm local time. National numbers are answered at different sites across the country. Representatives there can help you with other Social Security business as well.  

In person: You can phone or visit your local Social Security office. Local office hours vary but most have public hours of 9:00am – 3:00pm on Monday, Tuesday, Thursday and Friday and 9:00am – noon on Wednesday. Learn local office hours and locations here, in the “Find an Office” section. 

Even when your benefit payment continues going to the same bank, credit union or other financial institution, be sure to notify Social Security of mailing address changes. This helps you. It helps Social Security. 

By whatever method you choose, keep your mailing address current when you receive Social Security or SSI benefits. Important information is mailed to you during the year. Make sure you receive the news.

Baby names & SSN’s for newborns

A New Year is usually depicted as a baby. That, and local recognition of the first baby of the year, brought me to today’s topic of baby names.

Perhaps you will be helping to name a baby soon, perhaps not. Either way, annually near Mother’s Day, the Social Security Administration provides the most popular baby names of the previous year based on applications for new Social Security number (SSN) cards. The agency began compiling the baby name list in 1997, with names dating to back to 1880. 

Parents usually apply for the child’s SSN at the time of birth, thus making Social Security America’s source for the most popular baby names.   

How popular is your name? Popular baby names for 2013 and other years are on the Social Security website at www.socialsecurity.gov/OACT/babynames/. There you can learn popular baby names for the nation, by state, and see changes in popularity of a given name over many years. Other information for new parents is there too.

Nationally for 2013, the five most popular male names were Noah, Liam, Jacob, Mason and William. The five most popular female names were Sophia, Emma, Olivia, Isabella and Ava.  

Different spellings of similar names are not combined when compiling the popular name lists. For example, the names Caitlin, Caitlyn, Kaitlin, Kaitlyn, Kaitlynn, Katelyn, and Katelynn are considered separate names and each has its own rank.

New parents are encouraged to request a Social Security number (SSN) for their newborn through the hospital as part of the birth registration process. 

Very popular, this free and voluntary process, called Enumeration at Birth, allows the state agency that issues birth certificates to send the child’s birth registration information directly to the Social Security Administration. Without any additional paperwork, a SSN is issued to the child and the card mailed to the parents.  

If not using Enumeration at Birth, parents must first wait for the newborn’s official birth certificate to be issued before requesting a Social Security number for him or her. Then they must complete a SSN application and show the child’s birth certificate plus their own ID documents to Social Security. It is much easier and faster to do this as part of your child’s birth registration. Learn more at www.ssa.gov/pubs/EN-05-10023.pdf.