Understanding the reporting requirements for earnings is crucial to ensure that you receive accurate benefits from the Social Security Administration (SSA).
In this blog post, we will discuss the conditions under which you must report your earnings, the information required in your report, and the procedure for requesting an extension to file your report.
- When to report earnings to the Social Security Administration
You are required to report your earnings to the SSA if:
a. You haven’t reached full retirement age and are entitled to a monthly benefit, other than only a disability insurance benefit. b. Your wages and/or net earnings from self-employment in any month(s) of the year are below the allowable amount. This information helps establish your grace year and possible eligibility for benefits for those months.
- When to file your report
Your report should be filed on or before the 15th day of the fourth month following the close of the taxable year. An income tax return or form W-2 filed timely with the Internal Revenue Service may serve as the required report if it shows the same wages and/or net earnings from self-employment that must be reported to the SSA.
- Exemptions from reporting requirements
You are not required to report to the SSA if:
a. You reached full retirement age before the first month of your entitlement to benefits. b. Your benefit payments were suspended for all months of a taxable year before the year of full retirement age, or for all months prior to your full retirement age in the full retirement age year, under certain provisions.
- Reporting requirements for representative payees
If you receive benefits as a representative payee on behalf of a beneficiary, it is your duty to report any earnings of the beneficiary to the SSA.
- Information required in your report
Your report should include:
a. Your name, address, Social Security number, the taxable year for which the report is made, and the total amount of your wages and/or net earnings from self-employment during the taxable year. b. If you are a representative payee, your report should include the beneficiary’s information as well as your own.
- Extension of time for filing report
To request an extension for filing your report, you must submit a written request to a Social Security Administration office before your report is due. The request should include your name, the beneficiary’s Social Security number, the year for which your report is due, the amount of additional time requested, the reason for the extension, and your signature.
We will provide an example of how a representative payee can report earnings to the Social Security Administration (SSA) for a beneficiary.
We will use a fictional representative payee named Mary Johnson, who is managing Social Security benefits for her elderly mother, Alice Brown.
Step 1: Determine if reporting is required Alice is 68 years old and has reached full retirement age. However, she is entitled to monthly Social Security benefits and has part-time employment. As Alice’s representative payee, Mary is responsible for reporting her mother’s earnings to the SSA.
Step 2: Gather required information To report her mother’s earnings, Mary needs to provide the following information:
a. Alice’s name: Alice Brown b. Alice’s address: 789 Oak Street, Smalltown, USA c. Alice’s Social Security number: 135-79-2468 d. The taxable year for which the report is made: 2023 e. The total amount of Alice’s wages during the taxable year: $12,000 f. Mary’s name: Mary Johnson g. Mary’s address: 789 Oak Street, Smalltown, USA h. Mary’s Social Security number: 864-20-1357
Step 3: Determine the due date for the report Since Alice’s taxable year is the calendar year, the earnings report should be filed on or before April 15, 2024.
Step 4: Prepare the report Mary can use Alice’s income tax return or form W-2 as the required report if it shows the same wages that must be reported to the SSA. Alternatively, Mary can submit a separate report to the SSA with the required information mentioned in Step 2.
Step 5: File the report Mary submits the report to the SSA by the due date, either by including the required information on Alice’s income tax return or form W-2, or by sending a separate report to the SSA.
By following these steps, Mary has successfully reported her mother’s earnings to the Social Security Administration as a representative payee, ensuring Alice receives accurate benefits and avoids any overpayments or underpayments. As a representative payee, it’s crucial to report the beneficiary’s earnings on time and provide all the necessary information to ensure the correct amount of Social Security benefits is received.
Conclusion: Understanding and complying with the Social Security Administration’s reporting requirements for earnings is essential for ensuring that you receive the correct amount of benefits. Be sure to file your report on time and provide all the necessary information to avoid any issues with your benefits.
https://www.ssa.gov/OP_Home/cfr20/404/404-0452.htm
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