Social Security computation

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Q. I’m a CSRS/FERS hybrid federal retiree receiving Social Security and working part time. My earnings come close to but do not exceed the $14,000 limit. My employer withholds Social Security taxes from my earnings. Will my Social Security benefits ever increase because of my earnings? What if I earn in excess of the applicable yearly amount?

A. If you are under full Social Security retirement age, your Social Security benefit would be reduced by $1 for every $2 you earn through wages or self-employment. In 2012, that limit is $14,640. In the year you reach full retirement age, your benefit will be reduced by $1 for every $3 earned above a different limit. In 2012, that limit is $38,880. There won’t be any limit beginning in the month you reach full retirement age.

Even if you are subject to the earnings limit, the amount of Social Security benefit you are entitled to will grow every year based on your earnings and contributions to Social Security.

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Reg Jones was head of retirement and insurance policy at the Office of Personnel Management. Email your retirement-related questions to fedexperts@federaltimes.com.

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