Will My 1099 Income Be Used Just Like W-2 Earnings In Calculating My Benefit Rate?

Aug 26 2019 - 5:10pm

Larry: I started receiving 1099 earnings as an independent contractor at the age of 60 in 2010. Are the years beginning in 2010 of receiving 1099 income considered earnings just like W-2 earnings in calculating the 35 highest years of earnings for determining social security benefits? In other words, I elected to begin taking taking social security when I reached full retirement age (age 66). I have continued to earn and report income as an independent contractor on my tax returns beginning in tax year 2010. Is that income used to recalculate social security benefits in the future?


Your 1099 income would count as earnings that could be used to calculate your Social Security benefit amount provided that you report the 1099 income as self employment earnings and pay self-employment taxes on your net profit. Your earnings can continue to be used to recalculate your benefit rate as long as you continue working, but they will only increase your benefit rate if you earn more in a year than you did in one or more of your highest 35 years of wage-indexed earnings (https://www.ssa.gov/pubs/EN-05-10070.pdf).

Best, Jerry