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Insurance (Mine) > Social Security > Flashcards

Social Security Flashcards

1
Q

What are the NIIT income thresholds?

A
  • MFJ – $250,000
  • MFS – $125,000
  • Single – $200,000
    Not indexed – thus, more taxpayers will be subject to the tax
    over time
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2
Q

What is included in Net Investment Income? What is one thing that is not?

A

Net investment income includes portfolio income, income from
passive activities, gains on disposition of property, but does
not include distributions from qualified plans or IRAs.

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3
Q

HIGH INCOME MEDICARE TAX is how much %?

A

0.9%

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4
Q

High Income Medicare Tax Income Thresholds?

A
  • MFJ - $250,000
  • MFS - $125,000
  • Single - $200,000
    0.9% In Excess~!
  • This Medicare tax is paid by employees, not employers
  • Applies to wages, compensation or self-employment
    income
  • Not indexed – thus, more taxpayers will be subject to the
    tax over time
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5
Q

How do you calculate Self Employment Tax?

A

A = 92.35% times SE income
* 12.4% times (A) up to
$147,000 (2022), plus
* 2.9% times (A)

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6
Q

How much is SSDI of FICA? as a %

A

6.2% - ER 6.2% - EE / both up to $160,200 for 2023

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7
Q

How much of FICA is Medicare?

A

1.45% - ER 1.45% - EE / there is no income limit/cap like SSDI

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8
Q

How much do self-employed individuals pay for SSDI? (as a %)

A

12.4% / This stops at $160,200 SS Wage Base for 2024. This is calculated on Self Employment Income after you multiply Gross SE Income by 92.35%. Notice the Wage Base is calculated AFTER the Net SE Income Calc.

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9
Q

How much do self-employed individuals pay for Medicare?

A

2.9% / There is no income wage base for Medicare. This is calculated on Self Employment Income after you multiply Gross SE Income by 92.35%

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10
Q

Currently Insured is defined as:

A

6 out of the last 13 quarters.

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11
Q

Calculating AIME is based on:

A
  • Convert earnings after age 21 to current
    dollars using an indexing factor (National Average Wage Indexing Series)
  • Sum the highest 35 years
  • Divide sum by 420 months
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12
Q

Calculating PIA by: (Broadly know this)

A
  • Sum of three separate percentages of the AIME
     90% of the first $1,024 (different for 2024)
     32% of the AIME over $1,024 and less than $6,172
     15% of the AIME that exceeds $6,172
  • Maximum PIA at full retirement age: $3,358
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13
Q

How much (as a fraction) is SS decreased by in the first 36 months?

A

1/180th for each month early

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14
Q

How much (as a fraction) is SS decreased by in the following 24 months?

A

1/240th

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15
Q

SS is INCREASED by this flat % each year after FRA

A

8% NOT COMPOUNDED!

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16
Q

Taking SS at the earliest age (62) is how much of a haircut from FRA?

A

30% - 62
25% - 63
20% - 64
13.33% - 65
6.67% - 66

17
Q

REAPPLYING FOR BENEFITS

A

The Social Security Administration will allow a recipient of benefits to increase his or her benefits by withdrawing and reapplying at a future date. (Form SSA-521)

18
Q

What can cause a retiree to experience a loss in net social security benefits?

A

Earnings Test - If before FRA
Taxation on SS Benefits

19
Q

What are some items that are NOT considered earnings for SS Taxation?

A
  • Pension Income
  • Investment Income
  • Capital Gains
  • Passive Rental Activity
20
Q

SS is reduced by $_ for ever $_ earned over the Earnings Test.

A

$1 for every $2 earned over ~$22k

21
Q

Is the SS Earnings Test Different during the year of FRA?

A

YES! $1 for every $3 of earnings during year you turn 67

22
Q

What are the earning phase outs for the 50% SS Taxability?

A

Single: $25k
MFJ: $32k

23
Q

What are the earning phase outs for the 85% SS Taxability?

A

Single: $34k
MFJ: $44k

24
Q

These two items added together allow you to calculate SS Taxability:

A

Magi & 1/2 SS Benefits Received.

25
Q

What’s the most important part of the 50% and 85% calculation?

A

YOU USE THE LOWEST OF THE 2 AVAILABLE CALCULATIONS!

26
Q

If client is above the 85% taxability of SS Benefits: Start calculating taxability with -

A

The 85% equation:
85% * SS Benefit
or
85% * ((MAGI + 1/2 SS) - Adjusted Basis)
Which one is Lower?
add the lower adjusted limit amount to the lesser of:
50% * SS Benefit
or
50% * ((MAGI + SS Benefit) - Base Basis)

27
Q

SSDI Eligibility is:

A

20 out of 40 Quarters
Any Age
Cannot perform any GAINFUL work.

28
Q

Family Benefits for SS are payable to:

A

Spouse
* 62 and older
* Caring for a child
under age 16
* Caring for a child who
was disabled before
age 22

Unmarried Child
* Under 18
* Under age 19 and in
high school
* Age 18 or older and
disabled before age 22

29
Q

Survivor Benefits for SS are payable to:

A

Widow or Widower
* 60 and older
* Over 50 and disabled
* Caring for a child under age
16
* Caring for a child who was
disabled before age 22

Unmarried Child
* Under 18
* Under age 19 and in
high school
* Age 18 or older and
disabled before age 22

Dependent parents of the
deceased worker
* 62 and older
* Must not have a retirement
benefit greater than
deceased individual
* Deceased individual must
have provided at least 50
percent of parent’s support

30
Q

Is there a survivor DB for SS?

A

Yes, but must be currently covered

31
Q

What is the max family benefit?

A

175% of PIA

32
Q

Divorce SS Eligability:

A

An individual receiving benefits based on a spouse’s earnings:
Benefits cease at divorce, unless
* Individual is 62 or older and
was married longer than 10
years

33
Q

SSI is for:

A

Monthly payments to individuals with low income and few assets:
* Must be 65 and older
OR
* Disabled
* Blind

34
Q

SSI Is funded by:

A

SSI benefits are not funded by Social Security Taxes but are funded from the Treasury

35
Q

Medicare is facilitated by:

A

The Centers for Medicare and Medicaid Services (CMS)

36
Q

Medicare Benefits are provided to:

A
  • People 65 and older
  • Disabled individuals
  • Individuals with permanent kidney failure
  • If a worker applies for retirement benefits before age 65 there is no need to file a separate application or Medicare.
37
Q

Medicare Part B Covers (What %)?

A

80%

38
Q

Medicare Part C

A

Medicare Advantage (Part C) managed care plan: HMO, PSO, PPO
You CAN Switch from Part A+B to Part C

Insurance (Mine) (6 decks)

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