When Can We Withdraw an Application and Repay Benefits Received?

Jul 1 2016 - 10:45am

I turn 66 (11/2016) my spouse turns 66 (3/2017). Our new strategy is for her to Claim SS when I turn 66 and I will file a restricted application taking 50% of her benefit then take mine at 70. My question is that the SSA states she has to pay back an amount earned under full retirement age (Cap $15,720) and year of full retirement age (Cap of $41,880). The fact that the year she turns 66 is 2017, does she need to wait until 2017 to file so as not to pay back any funds. Her yearly income is approx.. $25,000. Thanks, Greg

Greg, to be clear, you wouldn't be "taking 50% of" your wife's benefit — you'd be filing for your spousal benefit, which is equal to 50% of her full retirement age (FRA) but does not decrease her benefit amount. She would only have to repay benefits received if your strategy involves withdrawing a previous application. You might wish to do so if she filed early and incurred a reduction. Withdrawing her application makes it as if she never applied and so there will be no reductions for early filing. She can only withdraw her application within 12 months of beginning them so waiting an additional year would make that impossible. Thanks, John