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RUSSELL GLOOR: Ask Rusty – Will my U.Okay. pension have an effect on my U.S. Social Security?

Share this…FacebookPinterestTwitterLinkedin Pricey Rusty: I’m 57 years previous, was born within the UK, and since 1988 have labored within the…

By Staff , in Social Security , at June 13, 2021



Pricey Rusty: I’m 57 years previous, was born within the UK, and since 1988 have labored within the U.S. I’ve at all times paid U.S. taxes and Social Security. For the final 20 years, my annual revenue has usually been effectively north of $100K.

In recent times I’ve made voluntary funds to the UK Nationwide Insurance coverage system seeking to declare a retirement profit from the UK in addition to from the U.S. My concern is that if I declare the UK profit, this may have an effect on my U.S. Social Security declare. Any perception you possibly can share might be appreciated. Signed: Nervous

Pricey Nervous:

In case you have 30 or extra years of U.S. employment the place you paid into Social Security by way of payroll taxes on “substantial” earnings, your U.Okay. pension is not going to have an effect on your U.S. Social Security profit whenever you declare it.

Social Security’s definition of “substantial” earnings is totally different for every year however, typically, in case you labored full time within the U.S. and paid into Social Security by way of payroll taxes since 1988, the so-called Windfall Elimination Provision (WEP) received’t have an effect on your U.S. Social Security advantages.

Here’s a hyperlink to Social Security’s WEP definition which features a desk of “substantial” earnings wanted to depend for WEP functions: www.ssa.gov/pubs/EN-05-10045.pdf. The doc at this hyperlink additionally describes how WEP works you probably have lower than 30 years of considerable U.S. earnings.

With lower than 30 years of considerable earnings on which you paid into Social Security your U.S. profit might be diminished on account of your U.Okay. pension. The quantity of discount would depend on what number of years of considerable SS-covered earnings you’ve got, however in no case can the discount be greater than 50 p.c of your U.Okay. pension.

If wanted, you may get your Earnings Assertion from Social Security, which can present your precise taxable SS earnings for every year to check in opposition to the WEP substantial earnings chart discovered on the above hyperlink. The simplest technique to get your Earnings Assertion is by way of your “My Social Security” on-line account. Should you haven’t but arrange your private on-line account with SS, you possibly can simply achieve this at this hyperlink: www.ssa.gov/myaccount.

So, the underside line is that this: In case you have contributed to U.S. Social Security from “substantial” earnings for not less than 30 years, your Social Security profit is not going to be affected by your U.Okay. pension; you probably have lower than 30 years of contributions to SS, it can. As chances are you’ll know, you can not accumulate your U.S. Social Security till you’re not less than age 62, however in case you declare at that age your profit quantity might be diminished by 30 p.c.

You’ll attain your full retirement age at age 67, and that’s the level at which you’re going to get 100% of what you’ve earned by working within the U.S. – topic to WEP discount solely you probably have lower than 30 years of contributions to Social Security.

Russell Gloor is a licensed Social Security advisor with the Affiliation of Mature American Residents.



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