Social Security questions and answers
Q. What is the Social Security tax rate for the year 2001?
A. The 2001 Social Security tax rate, also known as Federal Insurance Contribution Act (FICA) taxes, for employees and for self-employed people, are the same as last year. They are 7.65 percent for employees and 15.3 for self-employed people. (Self-employed pay the employers and employees tax, but get a tax credit for half of their payment on the Federal Income Tax return similar to the employers tax deduction for Social Security taxes paid.)
Social Security card
Q. Im pregnant with my first child. Friends said that Im supposed to get a Social Security card for my baby. With so many other things to do, must I come to the office to apply for my babys card?
A. No, you can apply for your babys Social Security card right in the hospital when you apply for the birth certificate. You just need to provide your own Social Security number and the number of the father if he is listed on the birth certificate. For more information, visit our website, www.ssa.gov, or call our toll-free number, 1-800-772-1213.
Q. My husband and I are both entitled to our own Social Security benefits. Will our combined benefits be reduced because we are married?
A. No. When each member of a married couple works in employment covered under Social Security, and they meet all other eligibility requirements to receive Social Security benefits, their lifetime earnings are calculated independently to determine their Social Security benefit amount. Therefore, each spouse receives a monthly benefit amount based on his or her own earnings. Couples are not penalized because they are married.
Q. I want to retire but dont know if there are advantages to waiting. Can you help?
A. If youre thinking about retiring soon, its a good idea to call Social Security first. We can help you plan the best time to retire, which may not necessarily be when you reach full retirement age. It could be at the beginning of the year you plan to retire. For all the details and to talk with a representative, call us toll-free at 1-800-772-1213. You may also want to check out our benefit planner found on the Internet at www.ssa.gov.
Q. Will my Social Security benefits be reduced because I will collect about $60,000 from my 401(k) plan and receive interest from a certificate of deposit each year?
A. No. Social Security benefits are not reduced by income received from investments, including interest on bank accounts. Also, benefits are not affected by non-work income, such as annuities, capital gains and pensions from work where you paid Social Security taxes.
Q. My brother-in-law recently died, leaving my sister to care for two children. He worked and paid into Social Security for 12 years. My sister has been a stay-at-home mom, and with the death of her husband, this is not the best time for her to enter the workforce. Can Social Security help?
A. Absolutely! Social Security offers survivors benefits to families of deceased workers. The value of Social Security survivors benefits for a young, average-wage earner who dies and leaves a spouse and two children is equivalent to a $354,000 life insurance policy. The benefits are paid monthly, averaging $1,611 per month for a family consisting of a widow and two minor children. For more information, visit our website at www.ssa.gov or call us at 1-800-772-1213.
Q. I know a guy who has never worked, and he gets Social Security disability benefits. How is this possible?
A. If he were disabled in childhood and continued to be disabled past age 22, your friend could receive disability benefits on a parents Social Security work record. Otherwise, it sounds like this person is not actually getting Social Security disability insurance benefits (SSDI), but Supplemental Security Income (SSI) benefits. SSI is a program administered by Social Security, but the money used to fund the program comes from general revenue taxes, not the Social Security trust funds. It covers disabled people who have not paid enough into the Social Security system to insure themselves for Social Security benefits. For more information about SSDI and SSI, log onto www.ssa.gov or call 1-800-772-1213.
Q. I think my neighbor is receiving disability benefits, but I know he repairs cars in his garage. How can I report this?
A. If you wish to report an allegation of fraud, you may call the Social Security Fraud Hotline toll free at 1-800-269-0271 or write us at Social Security Fraud Hotline, P.O. Box 17768, Baltimore, MD 21235. You can also send an e-mail message to: firstname.lastname@example.org or Fax information to (410) 597-0118.
Supplemental Security Income
Q. I want to apply for SSI, but I dont know if I qualify since I inherited my home from my parents. I cant work because of a disability and cant afford my utilities or groceries. Can I still get SSI?
A. For SSI purposes, you cannot have more than $2,000 in resources. However, the house that you live in is not counted as a resource. So, it is possible for you to get SSI even if you own your own home. Of course, you must file an application, and a decision must be made about your disabling condition. For more information, visit our website, www.ssa.gov, or call us at 1-800-772-1213.
Q. How, when and where do I sign up for Medicare when I turn 65 if I am not yet receiving Social Security benefits?
A. Some people are not automatically enrolled in Medicare. You need to file an application if you:
l Are eligible for Social Security or Railroad Retirement benefits but have not signed up for them;
l Have permanent kidney failure treated with dialysis or a transplant; or
l Are not eligible for premium-free Part A; or
l Are a government employee who is not eligible for Social Security or Railroad Retirement benefits.
You can call Social Security at 1-800-772-1213 to set up an appointment or go to your local Social Security office.