I will collect social security at 62.5 . my minor children will also receive benefits. I plan to continue working.
my benefit is 1990 per month . the childrens benefits will be total of 1950 per month. I will make $5500 per month.
Question: Will my monthly benefit be reduced to zero and than childrens benefits reduced, or will it be deducted from both of our benefits in an equal amount.

Hi,

The amount of benefits that are required to be withheld will be deducted from both your and your children's benefits. I'll give you an example to illustrate how the earnings test would be applied in a case similar to yours.

Say Jack files for his benefits at age 62 in January 2020. Jack's reduced monthly benefit rate is $2000, and the benefit rates of his 2 eligible children is $990 each. However, Jack is still working and will earn $5500 monthly throughout 2020.

Social Security's earnings test requires the withholding of $1 of the benefits payable on a worker's record for each $2 that their earnings in the year 2020 exceed $18,240. Since Jack will earn $66,000 in 2020 (i.e. $5500 x 12), Social Security will need to withhold $23,880 (i.e. ($66,000 - $18,240)/2) of the benefits payable on Jack's record for 2020. They would do so by withholding all of Jack's and his children's benefits for as many months as it takes to accumulate $23,880. And, since the total amount payable per month from Jack's record is $3980 (i.e. $2000 + $990 + $990), it will take full withholding of his and his children's benefits for the first 6 months (i.e. 6 x $3980 = $23,880) of 2020. Jack and his children could then be paid their full monthly benefits for the remaining 6 months of 2020.

If you haven't already done so, you may want to strongly consider using our software (https://maximizemysocialsecurity.com/purchase) to make sure that you choose the best possible strategy for maximizing benefits for you and your family.

Best, Jerry