My husband is 64. We have a 9 year old daughter. Can my husband file for ss now so my daughter gets her ss benefit. My husband will continue to work until 66. Because he is working, his ss payment before 66 will be reduced to $0 based on his high income. However, my understanding is his ss amount that is reduced during months he works will be added back into his lifetime ss maximum so that when he reaches full retirement age of 66, his ss which was reduced by filing at 64 will be recalculated and increased at 66 to give back the amount reduced fro 64-66. I think the net effect will be a payment at 66 for my husband nearly what he would have gotten if he waited and my daughter benefits by getting her ss benefit.
Hi,
The flaw in your plan is that the earnings test (https://www.ssa.gov/planners/retire/whileworking2.html) applies to all benefits payable on the worker's account, not just their own. So, depending on how much your husband earns, it's possible that neither he nor your daughter will be able to receive any benefits until he reaches full retirement age (FRA).
To give you an example, say that your husband's full retirement age rate is $2000. If he files at age 64, his monthly rate would be initially reduced to around $1733, but your daughter would be eligible for $1000 per month, or a full 50% of his unreduced rate. However, their total amount of $2733 per month would be subject to withholding if he continues to work and earns more than the yearly exempt amount, which is $15,720 this year, and $16,920 next year. In this example, if he earned more than around $50,000 next year, all of their benefits for the year would be withheld.
As you say, though, your husband's benefit rate would be recalculated effective with his month of FRA attainment in order to remove the reduction applied for any months for which he wasn't paid due to his earnings. So, if he files at age 64 but earns too much to receive any payments prior to FRA, his benefit rate would be increased to his unreduced FRA rate. But, that would mean that your daughter would not have been eligible for any benefits prior to your husband's FRA as well.
The earnings limit goes up and the withholding rate goes down in the year that your husband reaches his full retirement age, and only his earnings prior to the month he reaches his full retirement age count toward the earnings limit. So, one option may be for him and your daughter to start drawing benefits in January of that year, depending on his earnings level and the month of his birth. The potential downside is that your husband's benefit rate will be permanently reduced for any months that he is paid a full check prior to his month of FRA attainment.
By the way, it's possible that you may also be eligible for child-in-care benefits on your husband's record until your daughter reaches age 16 (https://www.ssa.gov/planners/retire/applying6.html). Those benefits would also be subject to the earnings test, however, at least until your husband reaches FRA. You may want to consider running the maximization software available on this website. It is programmed to handle family benefits, as well as the effects of the earnings test, so you may find it helpful in determining the best filing strategy for your family.
Best, Jerry
