What Happens to Your Social Security If You Keep Working?

You can work and receive Social Security benefits at the same time. If you continue working past retirement age, whether or not you’ve started collecting, you’ll still pay taxes on your earnings, and your benefits may also be taxable depending on your income, according to the Social Security Administration (SSA).

If you plan to continue working, or just want to know how it affects your Social Security benefits, here are a few key things to keep in mind.

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How Your Social Security Benefits Are Taxed

According to the Internal Revenue Service (IRS), if you receive Social Security benefits, you must pay taxes on up to 85% of your benefit amount if:

• You file a federal tax return as an individual and your combined income exceeds $34,000.

• You file a joint return, and you and your spouse have a combined income that exceeds $44,000.

Fifty percent may be taxable if:

• You file a federal tax return as an individual and your combined income totals $25,000 to $34,000.

• You file a joint return, and you and your spouse have a combined income that totals $32,000 to $44,000.

You can request the SSA to withhold funds from your benefits, which will be credited toward your federal taxes. If more funds are withheld than you would need to pay, the SSA will pay you the difference.

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How Earnings Can Alter Payout Amounts Before Retirement Age

Earnings from work can affect your Social Security in two ways: before you claim benefits and after you claim benefits.

• Before you claim: Working more years at a higher income can increase your future Social Security payments. That’s because your benefit amount is based on your 35 highest-earning years. If you’re still working and replacing lower-earning years with higher ones, your monthly benefit calculation will go up when you eventually file.

• After you claim: If you start collecting benefits before reaching your full retirement age (FRA), the Social Security Administration enforces an earnings limit. In 2025, if you are under full retirement age, you can earn up to $22,320 without penalty, according to the SSA. Beyond that, your benefits are reduced by $1 for every $2 earned above the limit. In the year you reach full retirement age, the higher limit is $59,520, with a $1 reduction for every $3 earned above it (only until the month you hit FRA). Once you reach full retirement age, you can earn as much as you want with no reduction in benefits.

Will Delaying Benefits Raise Future Payments?

Delaying benefits beyond your full retirement age can result in higher monthly payments. For each year you wait past your FRA, up until 70, your benefit grows by a set percentage known as delayed retirement credits. For most people, that’s about 8% more per year you delay.

By waiting, you boost your monthly check and also lock in a higher lifetime benefit amount, since that larger payment continues for as long as you live.

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This article originally appeared on GOBankingRates.com: What Happens to Your Social Security If You Keep Working?