Chapter 8- social security

Question 1

Social Security Act of 1935

Answer 1

• created to provide for United States citizens’ general welfare who are 65 years of age and older

Question 2

The blackout period

Answer 2

is the period following the death of a family breadwinner, during which no Social Security benefits are available to the surviving spouse.

Question 3

• the determining factor between being classified as fully insured or currently insured
• Once a person becomes fully insured, death benefits are extended to his (or her) family
• maximum one person can earn in a given year is 4

Answer 3

Credits

Question 4

For the ____ ____ to apply, an individual must have been employed and have paid FICA taxes for ten years, at least

Answer 4

40-quarter rule

Question 5

Currently insured status

Answer 5

a status of limited eligibility that provides only death benefits.

Question 6

Disability Benefit Qualifications

Answer 6

when Social Security uses both medical disability criteria and non-medical criteria to determine whether you qualify for SSDI or SSI

However, you must be able to prove that you are medically disabled first.

Question 7

Social Security:

Social Security disability insurance SSDI, the program based on ___ ___

Supplemental Security Income SSI, the _________ program

Answer 7

work credits; low-income

Question 8

FICA taxes (Federal Insurance Contributions Act)

Answer 8

• FICA taxes are used to fund the Social Security program.
• If a person has not contributed through their payroll program, they are not eligible for benefits.

Question 9

a status of complete eligibility for the full range of Social Security benefits: death benefits, retirement benefits, disability benefits, and Medicare benefits.

Answer 9

Fully insured

Question 10

to be fully insured, a person must have contributed to _____ ____ for __ ____ of employment

Answer 10

FICA taxes; 40 quarters (10 years)

Question 11

Fully and permanently insured

Answer 11

means an individual has paid FICA contributions for at least 40 quarters (which are not required to be consecutive)

Question 12

Old Age, Survivor, and Disability Insurance (Social Security)

Answer 12

To pay for these programs, the federal government imposes a tax on earned income that must be withheld by your employer.
- The OASDI deduction on your paycheck shows how much was withheld.

Question 13

the benefit (before rounding down to the next lower whole dollar) a person would receive if he/she elects to begin receiving retirement benefits at his/her normal retirement age.
- At this age, the benefit is neither reduced for early retirement nor increased for delayed retirement.

Answer 13

Primary Insurance Amount (PIA)

Question 14

a basic unit for determining whether a worker is insured under the Social Security program

Answer 14

quarter of coverage

Question 15

• only available to covered workers who are fully insured upon retirement, and these benefits are paid monthly.
• If a covered worker retires at the normal retirement age, he or she will receive 100% of the PIA
• if a covered worker retires early at the age of 62, the maximum Social Security benefit is 80% of the PIA

Answer 15

Social Security retirement benefits

Question 16

Taxation of Social Security Benefits

Answer 16

states that Social Security benefits are subject to federal income tax if the beneficiary files an individual tax return and his or her annual income is greater than $25,000