If You’re Not Sure Why You Received A Payment
If you receive a check or direct deposit payment from the Treasury Department and do not know what its for, contact the regional financial center that issued it. Only the agency that authorized the payment can explain why you received it.
If you received a check, look for the RFCs city and state at the top center. Then contact that RFC to find out which federal agency authorized the payment. It will be one of these:
If you received payment byelectronic funds transfer , or direct deposit, follow the directions under Find Information About a Payment.
Use the Treasury Check Verification System to verify that the check is legitimate and issued by the government.
Eligibility For Social Security
You can sign up for Social Security benefits if you are 62 or older, disabled or blind and have enough work credits.
Work credits are based on how long you have worked and paid Social Security taxes and on how much you earned at your job. You earn up to four work credits per year up to a maximum of 40 credits after 10 years of work.
Even though you are eligible for Social Security at age 62, you will only receive a percentage of them until you turn 67 and waiting until you are older means your Social Security benefits will be higher each month. This can make a difference of several thousand dollars per year.
Additional Medicare Tax Withholding Rate
Additional Medicare Tax applies to an individual’s Medicare wages that exceed a threshold amount based on the taxpayer’s filing status. Employers are responsible for withholding the 0.9% Additional Medicare Tax on an individual’s wages paid in excess of $200,000 in a calendar year, without regard to filing status. An employer is required to begin withholding Additional Medicare Tax in the pay period in which it pays wages in excess of $200,000 to an employee and continue to withhold it each pay period until the end of the calendar year. There’s no employer match for Additional Medicare Tax. For more information, see the Instructions for Form 8959 and Questions and Answers for the Additional Medicare Tax.
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Eligibility For Medicare And Social Security
Medicare and Social Security have different eligibility requirements but some of them are linked. Youll need to understand some of the basics of Medicare and of Social Security before signing up. But youll need to sign up for both separately.
You sign up for both Social Security and Medicare through the Social Security Administration. You can apply online or by telephone. Office visits were curtailed as a result of the COVID-19 pandemic but you can check with the Social Security Administration to request an in-person visit.
How to Enroll in Social Security and Medicare
- Apply for Social Security retirement, spouses, or disability benefits or for Medicare online at the Social Security Administrations website
And Finally Heres Where The Two Overlap:
The SSA determines whos eligible for Medicare and handles some of Medicares administrative duties, like enrollment. Thats why people enroll in Medicare by contacting the SSA.
While my grandma saved up for new shoes, youre investing in a much better pay-off. Share this article with friends and family whod like to know what theyre saving up for.
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Scenario : You Want To Wait To Take Social Security Until Well After You’re Eligible For Medicare
The opposite situation is a bit trickier. The SSA allows you to apply online just to receive Medicare benefits if you aren’t yet ready to claim your Social Security. That will meet the requirements for getting Medicare coverage within the appropriate initial enrollment period, avoiding any potential penalties that can result from missing that deadline.
Later on, you can apply for retirement or spousal Social Security benefits based on your time schedule. This allows you to take advantage of delayed retirement credits on your retirement benefits, boosting your monthly check by 8% per year beyond your full retirement age. The later application process isn’t automatic as it is with Medicare, but it does give you the financial flexibility to tailor your retirement planning to your specific needs.
As you can see, in many cases, you can sign up for Medicare and Social Security at the same time. Even if you don’t get benefits simultaneously, the process is typically simple unless you decide to delay taking Social Security beyond the 65-year-old eligibility age for Medicare benefits.
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If You Get Ssdi Benefits And Are In A 24
- You may be able to get Medicaid coverage while you wait. You can apply 2 ways:
- Create an account or log in to complete an application. Answer yes when asked if you have a disability. Well forward your application to your state Medicaid agency.
- Apply directly to your state Medicaid agency. Select your state from the menu on this Medicaid page for contact information.
When asked about your income on your Marketplace application, be sure to include your SSDI income.
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How The Social Security Tax Functions
Employees and self-employed taxpayers are subject to the Social Security tax. Employers often deduct this tax from employees wages and remit it to the government. The monies received from employees for Social Security are not held in trust for the specific employee who is now contributing to the fund, but are instead utilized to pay existing older persons under a pay-as-you-go system.
Social Security taxes are also collected to assist those who are entitled to survivorship benefits, which are payments made to a surviving spouse after the death of a spouse or to a dependent child after the death of a parent.
As of 2021, the Social Security tax rate is 12.4 percent. 6.2 % is paid by the employer, with the employee responsible for the other 6.2%. The Social Security tax rate is applied to all sorts of employee income, including salaries, wages, and bonuses. There is, however, an income cap over which the tax rate is imposed. For 2021, the Social Security tax is deducted from earnings up to an annual maximum of $142,800 earnings over this level are exempt.
If A Section 218 Agreement Is In Effect: Is The Position Optionally Excluded From Coverage Under The Section 218 Agreement/modification
A list of mandatory and optional exclusions is included in Chapter 5: “Social Security and Medicare Coverage” of Publication 963, Federal-State Reference GuidePDF.
The optional exclusions include:
- Agricultural labor, but only those services that would be excluded if performed for a private sector employer,
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All services in any class or classes of elective positions,
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Services performed by election workers and election officials paid less than the calendar year threshold amount mandated by law unless Section 218 agreement covers election workers.
- Services in any class or classes of positions compensated solely by fees received directly from the public, by an individual who is treated by the entity as self-employed unless Section 218 agreement covers these services.
- All services in any class or classes of part-time positions,
- Services performed by students enrolled and regularly attending classes at the school, college or university where they are working.
The effective date of coverage is the date specified in the Section 218 Agreement/Modification for coverage to begin.
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Who Can Claim Social Security
There are various types of Social Security benefits, but heres how to qualify for the retirement benefits that could make up a third of your monthly income:
- You are at least 62 years old
- You have worked at least 10 full years , and Social Security taxes were withheld or
- Your spouse or ex-spouse worked 10+ years, and you qualify for benefits based on his or her record.
Keep in mind that Social Security benefits may also be available for children, spouses, former spouses or people with disabilities. And if a loved one dies, certain family members may qualify for survivor benefits. To learn more about qualifying for any of these benefits, you should consult a tax professional or your financial consultant to see how it applies to your own situation.
How Social Security Helps Pay For Medicare
In addition to automatically enrolling you in Medicare, if you are receiving Social Security or Railroad Retirement Board benefits, your Medicare Part B premium will be automatically deducted from your monthly benefit payment.
If you are not receiving Social Security or Railroad Retirement Board benefits yet, you will get a bill called a Notice of Medicare Premium Payment Due . Bills can be paid for by check or money order, a credit or debit card, or through online bill pay services.
In conclusion, as youre starting to think about Medicare and retirement, do some research and make sure you understand how your Social Security benefits can or will play a role.
Footnotes
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How The Age You Retire Affects Your Benefits
You can apply for Social Security retirement benefits once youve turned 62. However, youll receive more money per month if you wait a few years. People who start collecting retirement benefits at 62 will receive 70 percent of their full benefit amount. You can receive 100 percent of your benefit amount if you dont start collecting until full retirement age.
The full retirement age for people born after 1960 is 67. If you were born before 1960, refer to this chart from Social Security to see when youll reach full retirement age.
You can qualify for additional benefits if you have a limited income. Known as Supplemental Security Income , these benefits are for people with limited income who qualify for Social Security because of age or disability.
Social Security And Medicare Funds Were Already At Risk The Virus Crisis Will Deplete Them Faster
WASHINGTON The financial condition of the governments two biggest benefit programs remains shaky, with Medicare expected to become insolvent in just six years, while Social Security will be unable to pay full benefits starting in 2035, the government said Wednesday.
And thats before factoring what officials acknowledge will be a substantial hit to both programs from the coronavirus pandemic, which has shut down large parts of the U.S. economy and put millions of people out of work.
The depletion dates, which remained unchanged from last years estimates, were revealed Wednesday with release of the annual trustees reports of both programs. When Social Securitys reserves are exhausted in 2035, the program will only be able to pay 79% of benefits at that time.
Even if employment rebounds by the end of this year and payroll taxes return to near-normal levels, the shock from the pandemic shutdown could accelerate the depletion of the Social Security trust fund by about six months, officials told reporters.
If a recession extends into next year, it could mean that a depletion would come a full year earlier. The consequences may be worse for the Medicare program, which in this report is estimated to deplete its reserves in 2026.
That will be reflected in next years report, Arnone said.
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Already Enrolled In Medicare
If you have Medicare, you can get information and services online. Find out how to .
If you are enrolled in Medicare Part A and you want to sign up for Part B, please complete form CMS-40B, Application for Enrollment in Medicare Part B . If you are applying for Medicare Part B due to a loss of employment or group health coverage, you will also need to complete form CMS-L564, Request for Employment Information.
You can use one of the following options to submit your enrollment request under the Special Enrollment Period:
Note: When completing the forms CMS-40B and CMS-L564:
- State I want Part B coverage to begin in the remarks section of the CMS-40B form or online application.
- If possible, your employer should complete Section B.
- If your employer is unable to complete Section B, please complete that portion as best as you can on their behalf and submit one of the following forms of secondary evidence:
- Income tax form that shows health insurance premiums paid.
- W-2s reflecting pre-tax medical contributions.
- Pay stubs that reflect health insurance premium deductions.
- Health insurance cards with a policy effective date.
- Explanations of benefits paid by the GHP or LGHP.
- Statements or receipts that reflect payment of health insurance premiums.
Some people with limited resources and income may also be able to get .
Who Is Eligible For Ssdi
The rules are different when youre applying for SSDI. Youll need 40 work credits if youre applying at age 62 or older.
To qualify for SSDI, you must:
- be unable to work because of a medical condition that will last at least 12 months, or is terminal
- not currently have a partial or short-term disability
- meet SSAs definition of a disability
- be younger than full retirement age
You must be able to prove you meet these criteria, and this process can be difficult. Once you qualify for SSDI, the amount of disability youll receive may be based on your age and the amount of time youve worked and paid into Social Security.
This table explains what benefits are offered based on your age and number of years worked:
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Is The Employee Covered By A Section 218 Agreement Or A Modification Amending The Agreement
Your State Social Security Administrator is responsible for determining whether a position occupied by a particular government employee is covered by a Section 218 Agreement. Contact that office if you are uncertain whether you have a Section 218 Agreement or have questions about coverage for particular positions. You can identify your state Social Security Administrator at the National Conference of State Administrators website.
How Do Medicare And Social Security Work Together
Youll get Medicare automatically if youre already receiving Social Security retirement or SSDI benefits. For example, if you took retirement benefits starting at age 62, youll be enrolled in Medicare three months before your 65th birthday. Youll also be automatically enrolled once youve been receiving SSDI for 24 months.
Youll need to enroll in Medicare if you turn 65 but havent taken your Social Security benefits yet. The Social Security Administration and Medicare will send you a Welcome to Medicare packet when youre eligible to enroll. The packet will walk you through your Medicare choices and help you enroll.
SSA will also determine the amount you need to pay for Medicare coverage. You wont pay premiums for Part A unless you dont meet the coverage rules discussed above, but most people will pay a premium for Part B.
In 2020, the standard premium amount is $144.60. This amount will be higher if you have a large income. Social Security uses your tax records to determine the rates you need to pay.
If you make more than $87,000 a year, SSA will send you an Income-Related Monthly Adjustment Amount . Your IRMAA notification will tell you the amount above the standard premium you need to pay. Youll also be responsible for an IRMAA if you choose to buy a separate Part D plan and you make over $87,000.
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Whats Social Security And Medicare
Learn how Social Security and Medicare care work, and how these programs could impact your retirement finances.
Social Security and Medicare are federal government-run safety programs that serve retired and disabled Americans. Workers contribute to both programs during their working years through payroll taxes, and they become eligible to receive benefits when they meet the eligibility criteria for each benefit. Here is what to expect from both programs when applying for benefits.
Both Social Security and Medicare provide benefits to specific categories of people. Social Security provides financial support to retired workers, disabled workers, and survivors of deceased workers, while Medicare offers subsidized healthcare services to help beneficiaries cover medical treatments, doctor visits, and hospital stays. If you are receiving Social Security benefits, SSA will automatically sign you up for Medicare when you reach age 65.
Different Ages For Different Benefits
One of the complexities involved in signing up for Social Security and Medicare is that people become eligible for the two programs at different times. Social Security retirement benefits are available as early as age 62, but most people don’t become eligible to receive Medicare benefits until age 65.
If you happen to want to retire right at age 65 and therefore want to start getting Social Security and Medicare benefits at the same time, then it’s easy to coordinate those benefits. The Social Security Administration handles the sign-up process for both Social Security and Medicare, and you can use a single application to file for both benefits if you’re within three months of your 65th birthday. The SSA’s online retirement application website is the easiest way to start.
However, if you have other plans for when to retire, then you’ll need to think carefully. There are two possible scenarios.
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