Browsing: self-employed

First-year rule

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Q. In 2012, what were the limitations for self-employment income for the first year of retirement, which was also the first year I received Social Security benefits? A. You’ll find what you’re looking for at www.socialsecurity.gov/retire2/rule.htm.

CSRS Offset and taxes

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Q. I’m planning to retire under CSRS Offset in December. Is local, state and federal tax the only tax I will have to pay? No Social Security or Medicare? A. Social Security and Medicare taxes are only deducted from earnings from wages or self-employment, not other sources of income, such as annuities.

Switching from Blue Cross/Blue Shield to Medicare Part B

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Q. 1. Can someone switch from Blue Cross/Blue Shield to Medicare Part B at age 71? 2. Should it be done? 3. If yes, how can it be done, and what are the costs? I am 71 and self-employed (since 2011), covered under my wife’s federal Blue Cross/Blue Shield plan. My wife has been retired for a few years and she also turned 71 in 2012. My wife was just operated for a brain tumor and is being scheduled for radiation therapy and chemotherapy. A. While your wife could disenroll from the Federal Employees Health Benefits program and both of…

Social Security

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Q. I retired on an early-out offer on Dec. 31, 2011, with 29.5 years of service at age 52. As a self-employed individual, I am paying both the employer and employee share (slightly reduced) to Social Security. Assuming another 15 years of work, that’s a tremendous amount to be paying into a retirement system with little or no benefit. I also have quarters from pre-CSRS employment. What, if any, Social Security benefit can I receive down the road? A. At age 62, you’ll be eligible for a Social Security benefit. Whether or not you apply for it at that time…

TSP, Social Security and annuity

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Q. When I retire under FERS, can I get all of my Thrift Savings Plan monies, Social Security and my annuity? Can I roll over my TSP monies without paying 30 percent of the total to the Internal Revenue Service? If so, what amount of tax-deferred monies, once rolled over, can I take out monthly without a penalty or have to pay taxes? A. Reg: Yes, you can receive an annuity and, unless you retire under the MRA+10 provision, the special retirement supplement, when you reach your minimum retirement age. Unless you exceed the Social Security earnings limit from wages…

Social Security earnings limit

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Q. I know that the Social Security supplement is reduced for any earnings above $14,640 (in fiscal year 2012). If I retire under FERS at my minimum retirement age but my wife keeps working at her job, will her earnings count toward that $14,640? Also, would distributions from my Thrift Savings Plan count toward it? A. Reg: The Social Security earnings limit applies only to your own earnings from wages and self-employment, not anything else. Mike: Your TSP distributions do not count as earned income.

Annuity reduction with part-time work

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Q. I am now retired from federal civil service under CSRS with 33 years of service. I have contemplated working a part-time job, nonfederal employment, and maybe becoming self-employed but wondered if I will have my annuity reduced due to additional earnings. Also, is there a maximum dollar amount I am allowed to earn annually beyond what I am paid in my retirement annuity before my retirement is reduced? A. As long as you aren’t re-employed by the federal government, you can make as much as you want without it affecting your CSRS annuity.

Special retirement supplement

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Q. I will be retiring from the Postal Service with 31 years of FERS at the age of 56. My question is about earning limits with the special retirement supplement. If, at age 56, I withdraw all or a portion of my Thrift Savings Plan account, will this affect my SRS from the USPS? A. No, it won’t. The Social Security earnings limit applies only to earnings from wages or self-employment.

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