Divorce has no impact on a person who collects retiree
benefits based on her or his own earnings record. The worker simply
applies for benefits when eligible (e.g., becoming disabled or being age
62 or older). And the worker’s current spouse can receive benefits
based on the worker’s earnings record. However, if you are an ex-spouse
you may be able to claim benefits based on your former partner’s
earnings record. This is called spousal benefits.
If you’ve been divorced from more than one spouse and each marriage lasted at least 10 years, you do not get to double dip on benefits. If you collect a spousal benefit, it is based on the earnings record of the ex-spouse with the greater earnings record.
If you remarry after beginning to collect spousal benefits, the benefits will stop.
To prove eligibility, be prepared to present a lot of paperwork. You need to show a marriage license and divorce decree (and a death certificate if the former spouse has died). It is not necessary for a former spouse to consent to your collecting benefits based on his or her earnings record (your former spouse likely will not even know you are collecting on his or her earnings record). It is not necessary for a divorce decree to provide for this option.
If you have not attained full retirement age (currently 66). (See How Are Social Security Benefits Estimated & Taxed? for chart to determine what your retirement age will be.) You can collect the higher of your own or spousal benefits. Spousal benefits are 50% of the worker’s benefits at full retirement age. If your former spouse continues to work past full retirement age in order to obtain delayed retirement credits, this does not increase your spousal benefits.
If you commence spousal benefits before you have reached full retirement age, you are not permitted to switch to collecting personal benefits when you do attain full retirement age. Thus, this option should be used only if you’re confident that your personal benefits will ultimately be smaller than 50% of your former spouse’s benefits.
If your former spouse is younger than you, you can commence personal benefits if you are at least 62 years old and then switch to spousal benefits when your spouse reaches age 62. This assumes that the switch to spousal benefits would produce a greater benefit than your personal benefit.
When collecting benefits (your own or spousal benefits), if you continue to work, your benefits may be reduced. You lose $1 for each $2 of benefits if you are under the full retirement age and your earnings exceed a set amount. For 2015, the earnings limit is $1,310 per month ($15,720 per year). Thus, if you earn $2,000 in October, your benefits are reduced by $345 ([$2,000 - $1,310] ÷ 2).
If you have attained full retirement age and have an earnings record. You can receive the divorced spousal benefit now and delay receiving your personal benefits until a later date in order to accrue delayed retirement credits. This choice maximizes your Social Security benefits.
Regardless of your age, your Social Security benefits may be reduced if you also collect a benefit from the Federal Employees’ Retirement System at the same time. (e.g., your ex-spouse was a federal civil servant). Under the Windfall Elimination Provision, non–Social Security benefits are reduced by a complicated formula that can result in a reduction of about 32%. The formula is intended to optimize benefits paid to lower-paid individuals.
The 10-year marriage rule does not apply if there is a natural or adopted child of your ex-spouse spouse in your care. The child must be under age 16 or disabled and receiving benefits on your ex-spouse’s earnings record.
Eligibility for Spousal Benefits
As an ex-spouse you may receive benefits based on your ex-spouse’s earnings record, even if he or she has remarried, if all of the following conditions are met:-
You are entitled to benefits due to age or disability.
-
The marriage lasted 10 years or longer.
-
You are unmarried when applying for benefits. If you had remarried
but are currently single due to death, divorce or annulment, then you
are treated as unmarried for this purpose.
-
Your ex-spouse is at least 62 years old.
-
Your own benefits are less than what can be received based on the ex-spouse’s earnings record.
If you’ve been divorced from more than one spouse and each marriage lasted at least 10 years, you do not get to double dip on benefits. If you collect a spousal benefit, it is based on the earnings record of the ex-spouse with the greater earnings record.
If you remarry after beginning to collect spousal benefits, the benefits will stop.
To prove eligibility, be prepared to present a lot of paperwork. You need to show a marriage license and divorce decree (and a death certificate if the former spouse has died). It is not necessary for a former spouse to consent to your collecting benefits based on his or her earnings record (your former spouse likely will not even know you are collecting on his or her earnings record). It is not necessary for a divorce decree to provide for this option.
Amount of Benefits
The benefits that you receive as an ex-spouse depend on your age and earnings record, whether you are currently working, and the amount that can be received based on your ex-spouse’s earnings record. Obviously, if your own earnings record generates greater benefits than a spousal benefit, you collect your own benefits. But if the benefits are not greater, then your options depend on your age when you apply for benefits.If you have not attained full retirement age (currently 66). (See How Are Social Security Benefits Estimated & Taxed? for chart to determine what your retirement age will be.) You can collect the higher of your own or spousal benefits. Spousal benefits are 50% of the worker’s benefits at full retirement age. If your former spouse continues to work past full retirement age in order to obtain delayed retirement credits, this does not increase your spousal benefits.
If you commence spousal benefits before you have reached full retirement age, you are not permitted to switch to collecting personal benefits when you do attain full retirement age. Thus, this option should be used only if you’re confident that your personal benefits will ultimately be smaller than 50% of your former spouse’s benefits.
If your former spouse is younger than you, you can commence personal benefits if you are at least 62 years old and then switch to spousal benefits when your spouse reaches age 62. This assumes that the switch to spousal benefits would produce a greater benefit than your personal benefit.
When collecting benefits (your own or spousal benefits), if you continue to work, your benefits may be reduced. You lose $1 for each $2 of benefits if you are under the full retirement age and your earnings exceed a set amount. For 2015, the earnings limit is $1,310 per month ($15,720 per year). Thus, if you earn $2,000 in October, your benefits are reduced by $345 ([$2,000 - $1,310] ÷ 2).
If you have attained full retirement age and have an earnings record. You can receive the divorced spousal benefit now and delay receiving your personal benefits until a later date in order to accrue delayed retirement credits. This choice maximizes your Social Security benefits.
Regardless of your age, your Social Security benefits may be reduced if you also collect a benefit from the Federal Employees’ Retirement System at the same time. (e.g., your ex-spouse was a federal civil servant). Under the Windfall Elimination Provision, non–Social Security benefits are reduced by a complicated formula that can result in a reduction of about 32%. The formula is intended to optimize benefits paid to lower-paid individuals.
If the Worker Dies
If your former spouse dies, you may collect benefits as a widow(er) as long as the marriage lasted at least 10 years. Survivor benefits are 100%, rather than 50%, of the former spouse’s benefits. As a survivor, your retiree benefits can begin when you attain age 60; you do not have to be age 62 or older. What’s more, even if you remarry, this does not affect eligibility for survivor benefits as long as you are at least 60 years old (or 50 years old if disabled).The 10-year marriage rule does not apply if there is a natural or adopted child of your ex-spouse spouse in your care. The child must be under age 16 or disabled and receiving benefits on your ex-spouse’s earnings record.
No comments:
Post a Comment