How much income can you earn in 2010 and collect Social Security at age 62?

Answer 1

For the 2010 tax year, the answer depends on your age and whether you're drawing Social Security benefits for retirement or disability.

Retirement

If you've reached full retirement age (65 for people born prior to 1943; 66 for people born between 1943 and 1954), there is no limit to how much you can earn.

In the year you reach full retirement age, you can earn $37,680 annually, but for every $3.00 over the limit, $1.00 is withheld from your benefits until the month your reach full retirement age.

If you are under full retirement age, you can earn $14,160 per year without incurring a penalty. For every $2.00 over the limit, $1.00 is withheld from benefits.

Disability

People on disability can earn up to $1,000 per month ($12,000 per year) for most disabilities, or $1,640 per month ($19,680 per year) for anyone legally blind. Earning more than these limits would be considered engaging in Substantial Gainful Activity (SGA), would trigger a continuing disability review, and likely result in an end to the person's disability status with Social Security.

Any month a disabled person earns more than $720.00 is counted toward the nine-month trial work period, and may result in a continuing disability review (CDR).

Answer 2

If you are 62 years old in 2010, you will reach full retirement age at 66. Under 2010 SSA guidelines, people who have not yet reached full retirement age can earn only $14,160 per year without incurring a penalty. For every $2.00 over the limit, $1.00 is withheld from benefits. There is an exception for the first year of early retirement, though (in this case, age 62).

In the first year, there is no limit on the amount of income you can earn prior to the month you retire. You will not be penalized for pre-retirement income. For the remainder of the year, you will receive a full benefit check for each month in which you earn $1,180 or less (one-twelfth of $14,160).

If you earn more than the maximum allowed, the Social Security Administration will withhold your monthly benefit check beginning in January of the following year until the overage is completely offset.