Retirement Question.?

Question

I applied for Social Security at age 62 this year. I am still working part time so I can receive medical coverage. I am told that if I earn more than $13,560 my benefit will be reduced. If I ended up making $15,000 could I put $2000 in my IRA to keep me from being penalized?

Answer 1

Yes you can.  Your IRA contribution is subtracted from your adjustable gross income.

Your benefit will be the same in any case, but you will be taxed based on your total income that includes your SSI.

Check the tax tables.

Answer 2

I don't think that you can reduce it that way.  You could ask for a paycut from your employer though.

Answer 3

Good question.  To put $2000 into your IRA account, you would have to file a 1040 form.  If you are already filing the 1040 long form your income should already be reduced from other deductions.  It is my understanding that every dollar made over the $13650 reduces your social security payment by one half till the time you hit 66 years old.