Expiration of the payroll tax cut. Workers may have already noticed the hit their paychecks took this year due to the expiration of the payroll tax cut, which went from 4.2 percent to 6.2 percent on earnings of less than $113,700 (increased from $110,100 in 2012).
Paper checks to stop. On March 1, paper Social Security checks will no longer be sent to benefits recipients. Instead, you will need to choose between two options: direct deposit to a bank or credit union account or a prepaid Direct Express Debit MasterCard.
Online service increased. Those who qualify to begin receiving Social Security benefits can now apply online instead of visiting a Social Security office. In addition, you can access your Social Security statement online, which includes your earnings history and expected payments upon retirement.
Office hours decreased. Social Security offices have started decreasing their hours of operation to reduce costs, and now close at noon on Wednesdays.
Earnings limits increased. Workers aged 62 to 65 can now earn up to $15,120 before $1 in benefits will be withheld for every $2 of income earned above the limit. Those who turn 66 in 2014 can earn up to $40,080 before $1 in benefits will be withheld for every $3 of income earned above the limit. The earnings limit no longer applies to workers over the age of 66.
Payments increased. Social Security benefits payments increased by 1.7 percent as of Jan. 1, 2013, an average monthly increase of $21.
If you need to know more about effective retirement planning, call our office today to schedule a time for us to sit down and talk. We normally charge $750 for a Family Wealth Planning Session, but because this planning is so important, I’ve made space for the next two people who mention this article to have a complete planning session at no charge. Call today and mention this article.