Magnum One/Magnum One (Mid-American Digital) (Disc Manufacturing).iso/d10/guide61b.arc/LHARC6.EXE/SOCIAL.TUT

Text File | 1991-04-15 | 20KB | 491 lines

#help.tut Extra help for tutorials
#define.stb On line glossary- definitions of legal terms
/* We now continue with Social Security Basics */

     Work Credit For Retirement Benefits

The following table shows how much work credit is needed to be
eligible for retirement benefits. The people at any Social
Security office will be glad to give you more details.

Work Credit For Retirement
     Benefits

*********************************
 If you reach          Years you
    62 in                 need

    1981                 7 1/2
    1982                 7 3/4
    1984                 8 1/4
    1985                 8 1/2
    1987                 9
    1991 or later        10
************************************

     Work Credits For Survivors And Disability Benefits

The following tables show how much work credit is needed for
Survivors or Disability benefits. The amount of credit needed
varies by age and when you become disabled. The people at any
Social Security office can give you more information.

If you are disabled by blindness, you do not have to meet the
requirements of recent work. But you do need credit for
one-quarter year of work for each year since 1950 (or the year
you reached 21 if later),up to the year you became blind. A
minimum of one and one-half years of credit is needed.

Under a special rule, cash payments can be made to a worker's
children and their mother or father provided he or she worked
under Social Security one and one-half years in the three years
before death.

Work Credit For Survivors And
     Disability Benefits

*******************************
Born after 1929, die     Years
or become disabled       you
at age                   need
****************        *******
 28 or younger            1 1/2
 30                       2
 32                       2 1/2
 34                       3
 36                       3 1/2

 Born after 1929, die     Years
 or become disabled       you
 at age                   need
 ***********              ******
 38                       4
 40                       4 1/2
 42                       5
 44                       5 1/2
 46                       6
 48                       6 1/2
 50                       7
 52                       7 1/2
 Born after 1929,die      Years
 or become disabled       you
 at age                   need
 **************          *******
 54                       8
 56                       8 1/2
 58                       9
 60                       9 1/2
 62 or older              10
     Work Credit For Survivors And
     Disability Benefits
     *******************************
 Born before 1930, die    Years
 or become disabled       you
 before 62 in year        need
    1981                  7 1/2
    1983                  8
    1985                  8 1/2
    1987                  9
    1989                  9 1/2
    1991 or later         10

     Special Work Credit Rules

Although almost all jobs in the United States are covered by
Social Security, there are special rules which apply to some.

You should check with a Social Security office about these
special rules if you work in or about someone's home doing
housecleaning, gardening, or babysitting; if you are a student
and also employed by the school or college; if you own, operate
or work on a farm; if you are a member of a religious order;
if you have a job where you get cash tips or if you are an
employee in an international organization. Special rules also
apply to people who work or are self-employed outside the United
States.

As of Jan. 1, 1984, coverage has been extended to all employees
of nonprofit organizations and to new Federal Government
employees. Terminations of Social Security coverage for employees
of State and local governments is prohibited.

Leaflets containing information of special interest to
self-employed people, farmers, farm landlords, people who receive
cash tips and others are available free at any Social Security
office.

     Work Credits Required For
     Medicare Benefits

You will be entitled to Medicare hospital insurance at age 65 if
you have worked long enough under Social Security, the railroad
retirement system, or Federal employment, or you are entitled to
Social Security or railroad retirement benefits. For more
information contact any Social Security office.

No earnings credits are needed for the medical insurance part of
Medicare. To get medical insurance protection, you must enroll
for it and pay a monthly premium.


     ***********************
     WHAT ARE BENEFITS WORTH
     ***********************


     Amount Of Monthly Checks

In figuring benefits for workers who reach 62, become disabled or
die after 1978, actual earnings for the past years are adjusted
to take account of changes in average wages since 1951. These
adjusted earnings are averaged together and a formula is applied
to the average to obtain the benefit rate.

This method is intended to insure that benefits will reflect
changes in wage levels over your working lifetime. This is
important because average wages in our economy can change greatly
over a 30 or 40 year period.

Following are examples of benefits that can be paid:

- If you reach 65 in 1985, your retirement benefit can be as much
as $717.

- If you reach 62 in 1985, your monthly retirement benefit can
be as much as $591.

- If you become disabled in 1985, the monthly benefit to you as a
disabled worker can be as much as $909, depending on your age and
past earnings. If you have eligible dependents, the total monthly
family benefit payable can be up to $1,363.

- Survivors of a worker who dies in 1985 can expect to receive up
to $1,633 a month for a family of three or more.

There is no fixed minimum benefit amount for workers who reach
62, become disabled, or die after 1981. The benefit rate for
these workers and their dependents and survivors will be based
entirely on the worker's earnings covered by Social Security.
There is one exception: Members of religious orders who have
taken a vow of poverty will continue to qualify for a fixed
minimum benefit if they first become eligible for benefits
before 1992.

Retired and disabled workers who become eligible after 1985 for
a pension based in whole or in part on work not covered by Social
Security will have any Social Security benefit which they have
earned figured under a different formula. This will result in a
lower Social Security benefit to take account of the years of
work outside of covered employment. This will apply to people who
reach 62 or become disabled after 1985. This will not generally
apply to Federal Government and nonprofit organizational
employees who are mandatorily covered in 1984.

Social Security benefits for people on the rolls will increase
automatically each January as the cost of living rises. Each year
living costs will be compared with those of the year before. If
living costs have increased 3 percent or more, benefits will be
increased by the same amount.

Starting with the increase payable in January 1985, if the
balance of the Social Security trust funds is below 15 percent
(20 percent beginning with the January 1990 increase) of the
total amount required to pay benefits for the year, the annual
increase will be based on the increases in average wages if
lower than the increase in the cost of living.

If you qualify for checks on the record of more than one worker
(for example on your own work and your spouse's), you'll get an
amount equal to the larger of the two amounts.

If in addition to your Social Security benefit as a wife,
husband, widow, or widower, you receive a pension based on your
work in Federal, State, or local government not covered by Social
Security, your benefit as a dependent or survivor may be reduced.

For more information, ask for a copy of the leaflet, "Government
Pension Offset - How It May Affect You" at any Social Security
Office.

Benefits to a disabled worker and his or her family may be
reduced if he or she also receives a disability benefit paid by
Federal, State, or local government programs.

     Benefits May Be Taxable

Starting with 1984, up to one-half of your benefits may be
subject to the Federal income tax for any year in which your
adjusted gross income for the Federal tax purposes plus
nontaxable interest income and one-half of your Social Security
benefits exceeds a base amount.

The base amount is $25,000 for an individual, $32,000 for a
couple filing jointly and zero for a couple filing separately if
they lived together any part of the year.  The amount of benefits
subject to tax will be the smaller of:

- One-half the benefits, or
- One-half the amount of combined income (adjusted gross income
plus nontaxable interest plus one-half of total benefits) in
excess of the base amount.

Complete information can be found in Internal Revenue Service
publication 915.


Getting Bigger Checks Through Additional Work

If you return to work after you start getting retirement checks,
your added earnings may result in higher benefits. Social
Security will automatically refigure your benefit amount after
the additional earnings are credited to your record.

In addition, there is a special credit that can mean a larger
benefit. The credit adds 3 percent to a worker's benefit for each
year (one-fourth of one percent for each month) after the full
benefit retirement age (currently age 65) that he or she did not
get benefits because of work. The worker's additional credit also
increases payments to widows and widowers.

Starting for workers who reach 65 in 1990, the delayed retirement
credit will be increased gradually until it reaches 8 percent.


     Reduced Benefits For Early Retirement

You can retire as early as 62, but your retirement check will be
reduced permanently. Payment amounts are also reduced if a wife,
husband, widow, or widower starts getting payments before 65.

The amount of reduction depends on the number of months you get
checks before you reach 65. If you start your checks early,
you'll get about the same value in total benefits over the years,
but in smaller amounts to take account of the longer period
you'll get them.

Starting in 2000, the age at which full benefits are payable will
be increased in gradual steps until it reaches 67. This will
affect people born in 1938 and later. Reduced benefits will still
be payable at 62, but the reduction will be larger than it is
now.


     *********************
     WHY PAYMENTS MAY STOP
     *********************

     Working After Benefits Start

If you go back to work and are under 70, your earnings may affect
your Social Security benefits. You don't have to stop working
completely, though, to get Social Security benefits.

You can receive all benefits if your earnings do not exceed the
annual exempt amount. The annual exempt amount for 1985 is $7,320
for people 65 or over and $5,400 for people under 65.

If your earnings go over the annual exempt amount, we withhold $1
in benefits for each $2 of earnings above the limit. Starting in
1990, $1 in benefits will be withheld for each $3 in earnings
above the limit for people 65 and over.  Beginning in 2000, the
age at which this withholding rate applies will increase as the
retirement age increases.

Income from savings, most investments, or insurance won't affect
your checks.

A monthly test can be used the first year you have a month in
which you have little or no earnings or you don't work much in
your business. This test allows you to retire and get benefits
the rest of the year even though your total earnings go over the
annual limit.

This monthly test can also be used in the year benefits end by
children, students, or a mother or father who gets benefits
because he or she is caring for a child.

In future years, the annual exempt amounts will increase
automatically as the level of average wages rises. NOTE:
Different rules apply to work performed by people getting
benefits because they are disabled.  For more information, ask
for a copy of the leaflet, "If You Become Disabled", at any
Social Security office.

     If you are getting retirement checks, your earnings may affect
your dependent's checks as well as your own. If you get checks as
a dependent or survivor, your earnings affect only your own
check.

     Your earnings for the entire year in which your checks start or
stop count when we figure the amount of benefits that can be paid
for that year. Earnings in or after the month you reach 70 won't
affect your check.

     Going Outside The U.S.

Special rules apply to people outside the U.S.  If you go outside
the country for 30 days or more while you are getting checks,
your absence from this country may affect your right to checks.
Ask at any Social Security office for a copy of the leaflet,
"Your Social Security Checks While You're Outside The United
States."


*******************************
HOW SOCIAL SECURITY IS FINANCED
*******************************


     The Basic Idea

The basic idea of Social Security is simple: During working
years, employees, their employers, and self-employed people pay
Social Security taxes. This money is used to pay benefits to the
36 million people getting benefits and to pay administrative
costs of the program.

Then, when today's workers' earnings stop or are reduced because
of retirement, death or disability, benefits will be paid to them
from the taxes paid by people in covered work and self-employment
at that time.

Part of the taxes goes for hospital insurance under Medicare so
workers and their dependents will have help in paying their
hospital bills when they become eligible for Medicare. The
medical insurance part of Medicare is financed by premiums paid
by the people who have enrolled for this protection and amounts
from the Federal Government.

The Government's share of the cost for the medical insurance part
of Medicare and certain other Social Security costs comes from
general revenues of the U.S. Treasury, not from Social Security
taxes.

Funds not required for current benefit payments and expenses are
invested in interest-bearing U.S. Government securities.

     Tax Rates

If you're employed, you and your employer each pay an equal share
of Social Security taxes. If you're self-employed, you pay taxes
for retirement, survivors and disability insurance, and hospital
insurance at a rate twice the employee rate.

As long as you have earnings that are covered by the law, you
continue to pay Social Security taxes regardless of your age and
even if you are receiving Social Security benefits.

The following tables show the present and future Social Security
tax rates now scheduled in the law for both employees and for
people who are self-employed.

Tax Rates For Employees
     And Employers (each)
     *******************************
     Percent of
     Covered
 Years                 Earnings
 1983                    6.70
 1984                    7.00
 1985                    7.05
 1986 - 87               7.15
 1988 - 89               7.51
 1990 and after          7.65
*******************************

*******************************
     Tax Rate For
     Self-Employed People
     *******************************
     Percent of
     Covered
 Years                 Earnings
 1983                     9.35
 1984                    14.00
 1985                    14.10
 1986 - 87               14.30
 1988 - 89               15.02
 1990 and after          15.30


     Tax Credits

Self-employed people will receive a credit against the
self-employment Social Security tax. The credit amounts to 2.3
percent of self-employment income for 1985 and 2.0 percent for
1986 - 1989.

After 1989, this credit will be replaced with deductions designed
to treat the self-employed in much the same manner as employees
and employers are treated for Social Security and income tax
purposes under present law.

     Automatic Increases In The
     Earnings Base

The maximum amount of annual earnings that counts for Social
Security is $39,600 for 1985. The maximum will rise automatically
in future years as earnings levels rise. Every year the increase
in the average covered wages will be figured; and if wage levels
have increased since the base was last set, the base will be
raised - but only if there is an automatic benefit increase the
same year.

     How Taxes Are Paid

If you're employed, your Social Security tax is deducted from
your wages each payday. Your employer matches your payment and
sends the combined amount to the Internal Revenue Service. If
you're self-employed and your net earnings are $400 or more a
year, you must report your earnings and pay your self-employment
tax each year when you file your income tax return. This is true
even if you owe no income tax.
     Your wages and self-employment income are entered on your
Social Security record throughout your working years.This record
of your earnings will be used to determine your eligibility for
benefits and the amount of cash benefits you and your dependents
will receive.


     Excess Earnings, Taxes

When you work for more than one employer in a year and pay Social
Security taxes on wages over the maximum amount, you may claim a
refund of the excess amount on your income tax return for that
year. If you work for only one employer who deducts too much in
taxes, you should apply to the employer for a refund. A  refund
is made only when more than the required amount has been paid.
Questions about taxes or refunds should be directed to the
Internal Revenue Service.

Earnings over the maximum may appear on your Social Security
earnings record, but they cannot be used to figure your benefit
rate.

     Appeal Rights

If you feel that a decision made on your claim is not correct,
you may ask the Social Security Administration to reconsider it.
If, after this reconsideration, you still disagree with the
decision, you may ask for a hearing by an administrative law
judge of the Office of Hearings and Appeals.  And, if you're
not satisfied with the hearing decision, you may request a review
by the Appeals Council. If you're still not satisfied, you may
take your case to the Federal Courts.

The Social Security Administration makes no charge for any of the
appeals before the administration. You may, however, choose to be
represented by a person of your own choice, and he or she may
charge you a fee.

Someone in any Social Security office will explain how you may
appeal and will help you get your claim reconsidered or request a
hearing.

     For More Information

If you want more information about Social Security monthly
benefits or SSI, contact any Social Security office. The people
there will be glad to help you. To find the address of the
nearest office, look in the phone directory under "Social
Security Administration".