From what I can see, up until the age of 66 they actually WITHHOLD a portion of the benefits as per this publication:
At full retirement age or older
No limit on earnings
Under full retirement age
$14,160 / For every $2 over the limit, $1 is withheld from benefits.
$14,160 / For every $2 over the limit, $1 is withheld from benefits.
In the year you reach full retirement age
$37,680 / For every $3 over the limit, $1 is withheld from benefits until the month you reach full retirement age.
$37,680 / For every $3 over the limit, $1 is withheld from benefits until the month you reach full retirement age.
ssa.gov
Whatever benefits ARE received after these reductions are taxed. After the age of 66 there is no longer a limit and individuals continue to receive full benefits. In other words, as I said, one can be making $100s of thousands and still get full benefits.
Since the system is broken and since cuts will be unavoidable, continuing to reduce benefits to those who work beyond the regular retirement age may be a good place to start. Those who are actually retired and those who make only a small income will not be affected - hence, the relatively moderate political cost. |
