For millions of Americans, Social Security is not just a government program, for them it is their financial lifeline. Any disruption can become a grave matter of survival. In such situations, it is important to know if one is living under threats of losing their social security benefits.
Every month, retirees and disabled workers rely on these payments or checks to pay for their essentials like rent, groceries, and healthcare. However, these benefits are not guaranteed, and one is always at risk of losing this income.
There are several ways this might happen, and it is always better to understand situations under which something like this can come up so that recipients can avoid these situations.
Due to inflation and the high cost of basic requirements, many people choose to start collecting Social Security benefits as soon as they’re eligible at age 62. This definitely provides for early access to income, though it comes with several strings attached. This becomes more complicated if the recipients continue to work.
If someone claims their Social Security before their full retirement age, SSA places a cap on their approved annual income. Its recipient earns more than the Social Security Administration’s yearly limit, beneficiaries could lose a part of their benefits.
In 2025, that upper limit placed by SSA for annual income is $22,560. If one earns more than the set limit, SSA deducts $1 for every $2 earned over the limit.
Once retirees reach the year of their full retirement age, the rules change and are less strict.
The upper limit on the annual income goes up to $59,520, and only $1 will be withheld for every $3 above the cap. The earning limit is completely dissolved after the full retirement age is attained. Then the person is allowed to earn as much as they want without a threat of any penalties.
Social Security is largely protected from creditors. However, there are a few exceptions. Social security checks can be garnished if anyone owes federal income taxes, child support, or certain student loans. In such cases, the government can withhold part of its benefits until the debt is satisfied.
In addition, depending on the total income, one may come to realise that a significant portion of your benefits is taxable. The maximum tax the IRS can place on Social Security is 85%. This comes under the condition when the “combined income” exceeds certain thresholds.
Combined income is a sum of gross income, non-taxable interest, and half the Social Security payment. That means the net income of recipients could be much lower than expected, especially if they are also working or drawing from retirement accounts.
Another way one can lose Social Security benefits is when personal circumstances change. For example:
- A change in marital status, such as divorce or remarriage, may affect spousal or survivor benefits.
- Residency rules can reduce or eliminate benefits for some non-citizens living abroad.
- If there are lapses in paperwork, there is a direct impact on benefits. For example, if one fails to respond to SSA requests for verification, it can result in delayed or suspended payments.
It is very important to keep all the paperwork and records updated and accurate to avoid any delay in benefits.
Social Security is designed to provide peace of mind, but only careful planning will make sure you get the most out of what you’ve earned.
