How to Earn Social Security Credits

Generally, you earn Social Security credits when you work and pay Social Security taxes. Social Security credits determine, generally, when you are eligible for Social Security benefits, and how much you can get in benefits. The number of credits you need may differ depending on whether you're applying for retirement or disability benefits. The calculation also is different when calculating benefits for survivors after someone who has been working and paying Social Security taxes dies.

Method 1 - Earning Retirement Credits

1.Work in a job that counts towards Social Security. Most jobs qualify to earn Social Security credits, even earnings from self-employment. However, there are some jobs that aren't covered by Social Security and don't earn credits.

2.Pay Social Security taxes. To be eligible for Social Security retirement benefits, you must actually pay Social Security taxes on the money you earn. If you are an employee, your employer automatically withholds this money from your paycheck in most instances.

3.Calculate your yearly earnings. Earning credits is based on the length of time you work as well as the amount of money you earn. You can figure out the total amount you've earned by looking at your W-2s or 1099s.

4.Divide your earnings to find your credits earned. Social Security credits are, essentially, accounting units. A specific amount of money (which changes every year) equals one credit. You may earn up to 4 credits in any given year. For 2017, you receive one credit for every $1,300 you earn.

5.Review your Social Security statement regularly. Your Social Security is an important part of your retirement, so you need to make sure your income is being reported and credited correctly. If you check your Social Security statement regularly, you can identify possible errors in your employer's records.

6.Make sure your employer's records are accurate. Income might not be credited properly to your Social Security account if your employer has a mistake in their records. Check your pay stub and W-9 with your employer to make sure they have your correct Social Security number if you notice any discrepancies.

Method 2 - Calculating Disability Credits

1.Determine the quarter when you became disabled. Generally, the number of credits you need to qualify for disability depends on when you became disabled, and the calendar quarter in when your birthday occurs.

2.Check the years when you worked. To qualify for disability, you must meet a recent work test. At least a portion of your credits must have been worked in the years immediately before you became disabled. You'll use calendar quarters to determine whether you pass this test.

3.Total the number of years you worked. You also must meet the "duration of work" test to qualify for disability. Generally, if you have 40 credits, then you qualify for full disability benefits. That would mean you had worked for 10 years.

4.Consult a Social Security disability attorney. If you're applying for Social Security disability benefits, you have the right to be represented by an attorney. The process can be time-consuming and difficult, but having an attorney on your side will help.

5.Apply for benefits as soon as you become disabled. It can take months, if not years, to get approved for Social Security disability benefits. For this reason, it's generally best not to wait around to apply.

Method 3 - Evaluating Survivorship Credits

1.Find out who is eligible for survivors' benefits. When someone who has been paying into Social Security dies, certain members of their family, such as their spouse or children, may be eligible for survivors' benefits.

2.Calculate how many years the deceased person worked. Generally, a deceased person needs to have worked 10 years before they died for their survivors to be eligible for Social Security benefits.

3.Calculate the number of credits the deceased person had. Credits work much the same for survivors' benefits as they do for regular retirement benefits. Generally, if the person earned 40 credits, their survivors would be eligible for full survivors' benefits.

4.Adjust credits needed based on the age of the deceased. If someone has died at a younger age, before they became eligible for Social Security benefits, their survivors still may be eligible for survivors' benefits. However, the amount they are paid, and the length of time they're paid, may be significantly reduced.

5.Contact Social Security for more information. If you believe that you or a member of your family may be eligible to receive survivors' benefits after the death of a loved one, you should call the Social Security Administration as soon as possible and explain your particular family situation.

 

source: wikiHow

 

 

Published on: 4/5/18 5:46 AM