Larry, You provide great information. I have just one hopefully easy question. I plan to retire on February 1 2024 1 month before my 65th birthday. At that time I would get a payout of 12 weeks or more vacation. I fear that my 2024 earned income would jump to almost $40,000 for the year. How does the social security "earnings test" affect me? If I just wait until March to file for SS would it solve it or should I try to get a vacation payout in 2023? I thought I saw somewhere that there is no "monthly test" in 2024.

Thank you for all the information you have provided.

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Hi. Accumulated vacation pay received in a lump sum upon retirement can usually be excluded from counting toward the Social Security earnings test limit. But, Social Security won't know anything about your vacation pay unless you tell them about it. The only earnings information that Social Security will automatically receive is a copy of your W-2 form(s), and if it shows earnings of $40,000 then they will assume that all of that income is countable.

In order to get Social Security to exclude your vacation pay from counting toward your earnings limit you'll need to submit to them a form SSA-131 (https://www.ssa.gov/forms/ssa-131.pdf) that's been completed by your employer.

In spite of what you may have heard, there will be a monthly earnings test in 2024. The monthly earnings test can be used as an alternative to the annual earnings test in the initial year that a person starts collecting benefits, but the monthly test is only used if it allows the Social Security recipient to be paid more total benefits than they'd receive if the annual earnings test was used (https://www.ssa.gov/benefits/retirement/planner/rule.html).

It sounds like you should strongly consider using our software (https://maximizemysocialsecurity.com/purchase) to fully compare and analyze all of your various filing options so that you can determine your best strategy for maximizing your benefits.

Best, Jerry