Hi will be eligible to take my Social Security starting in June of this year as I will be 62. I have a part-time job at a university where I will gross more than the $1540 per month for that first year I am eligible. Does that mean I will be penalized and I’m not able to take my Social Security or do I pay back one dollar for every two dollars I make?
Thank you!

Hi. The monthly earnings test limit in 2021 is actually $1580, not $1540. If you earn more than $1580 in every month this year, then you couldn't be paid any benefits based on the monthly earnings test (https://www.ssa.gov/benefits/retirement/planner/rule.html).

However, depending on the total amount of your 2021 calendar year earnings you might still be able to be paid at least some benefits this year. Before paying you any benefits, though, Social Security would need to withhold $1 of your benefits for each $2 that your calendar year earnings exceed $18960.

For example, say Sally (DOB 5/14/1959) files for benefits effective June 2021. Sally's monthly benefit rate reduced for her age is $1200. Sally is earning $2580 per month throughout 2021, or $30960 for the calendar year. Social Security would then need to withhold $6000 of Sally's 2021 benefits, or $1 for each $2 that her earnings will exceed $18960 (i.e. ($30960-$18960)/2). Social Security would do that by withholding Sally's full benefit payments for June through October (i.e. $1200 x 5 = $6000). Sally could then be paid her full reduced benefit amount of $1200 for the months November & December 2021.

Our software (https://maximizemysocialsecurity.com/purchase) to fully programmed to handle both annual and monthly earnings test considerations, so you should strongly consider using our software to help you determine your best strategy for maximizing your benefits.

Best, Jerry