Reasons You’re Getting a Smaller Social Security Check Read this article to get to know the reasons Why do you receive smaller Social security Check and way to fix it.
Be aware that your actual benefit may be less than what your statement shows. Here are some reasons why that can happen.
- You claimed your benefit early.
- Your earnings changed.
- Medicare Part B premiums withheld.
- Medicare Part D premium increase.
- Tax withholding.
- Working after starting benefits.
You Claimed Your Benefit Early
Your Social Security benefit statement gives you an estimate of how much you’ll receive if you claim at various ages. For example, if you claim your benefit at the earliest possible time, which is when you turn 62, you’ll receive less than if you wait until full retirement age. That age is 66 for those born in the 1950s and 67 for those born in 1960 or later. Your benefit will be the highest if you wait until you turn 70, the oldest age at which you can claim.
Your Earnings Changed
Social Security payments are calculated based on a recipient’s 35 highest-earning years in the workforce.
If you have some years when you didn’t work, you’ll see zeros on those lines. Those years are included in your lifetime average and will reduce your monthly benefit.
Medicare Part B Premiums Withheld
Generally, your Medicare Part B premiums will be withheld from your Social Security payment.
The standard Medicare Part B premium is $164.90 per month in 2023, although it could be higher, depending on your income.
If the Medicare premium increases, which it sometimes does, it won’t put a dent in most Social Security recipients’ monthly benefits after they’ve enrolled in both programs.
However, higher earners may see a decrease. Social Security recipients who have an income greater than $97,000 for individuals and $194,000 for married couples filing jointly will see higher Medicare Part B premiums and potentially lower Social Security benefits.
Medicare Part D Premium Increase
Social Security recipients may elect to have their Medicare Part D premiums withheld from their Social Security check. These premiums are calculated based on an individual’s income. The higher your income, the more you may pay for this prescription drug coverage, as determined by a sliding scale. The plan you join also affects your Medicare Part D premium.
Medicare Part D premiums are not automatically deducted from Social Security benefits, but you can ask your Part D drug plan to make that deduction.
Tax Withholding
Americans who have sources of income in addition to Social Security, such as retirement account withdrawals, rental income or a pension, may have to pay taxes on Social Security.
Working After Starting Benefits
Social Security recipients who claim their benefit before full retirement age and continue to work after claiming their benefit will typically have a portion of that benefit withheld. However, you’ll get those withholdings back after you reach full retirement age.
If you’re younger than full retirement age, the IRS deducts $1 from your benefit for each $2 you earn above $21,240.
