Social Security
Cost-of-Living Adjustments (COLA)
OASDI benegits ate increased automatically each January as long as there has been an increase in the CPI for the one-year period ending in the third quarter of the prior year.
earnings test
a participant receiving SS benefits furor to his or her SS full retirement age will have a reduction in benefits if his or her earrings from employment exceeds a specified level. benefits reduced one dollar for every two earned in excess of $15,120. EXCEPTION: in the calendar year where individual reached full retirement age, reduction is only one dollar for every three in excess of $40,080 **earnings include only amounts earned before the month the individual reaches full retirement age
fully insured status
a qualified plan that is completely funded with life insurance or annuity contracts
currently insured
a status under social security that means that the worker's dependents are eligible for survivor's benefits. it is only necessary to have credit for 6 quarters of coverage out if the 13-quarter period ending with the quarter in which the death occurs.
disability insured
an individual who is eligible to receive social security disability benefits. requires that a worker (1) be fully insured and (2) have a minimum amount of work under social security within a recent time period.
earnings and benefit estimate statement
annual statement to each worker who is not currently receiving benefits who is over the age 25 that estimates (1) SS retirement benefit the client will receive, (2) disability and survivors benefits that your client will get from SS, and (3) the full retirement age of your client. **check on current benefit amounts and earnings history
FICA tax
social security benefits are financed through a system of payroll taxes paid by all persons covered under the program as well as their employers. "Federal Insurance Contribution Act"
SECA tax
social security benefits are financed through a system of self-employment taxes paid by all persons covered under the program as well as their employers "self-employment contribution act"
Primary Insurance Amount (PIA)
social security retirement benefits are based on a formula that is a function of the worker's average indexed monthly earnings (AIME).
full retirement age
the age at which the individual is entitled to full retirement benefits from social security. the age is currently transitioning from 65 to 67
provisional income
the income counted when determining whether or not social security benefits are taxed. includes adjusted gross income, tax-free municipal bond earnings, and one-half of the SS benefit received.
family maximum
the max benefit payable when there are three or more family members (including a retired or disabled worker) eligible for benefits based a single worker's wage.
quarters of coverage
the method of determining eligibility for social security benefits.
Social Security
the old-age, survivors, disability, and health insurance (OASDHI) program of the federal government
Average Indexed Monthly Earnings (AIME)
the term used to describe the indexed earnings figure used to calculate social security retirement benefits. represents the 35 highest years of wages earned by the individual.