Knowing The Basic Facts About Social Security and Medicare Programs, Which Include Medical Insurance As Well As Retirement, Disability, And Survivors’ Benefits
By: Gerard A. Jones
WHAT YOU PAY
In 2010, you and your employer will each pay a Social Security tax (FICA) of 6.2% on the first $106,800 of your earnings, plus a Medicare tax of 1.45% for all that you earn.
The Social Security and Medicare taxes paid by you and your employer will continue as long as you are working, regardless of your age and even though you may be receiving Social Security benefits. If you work for more than one employer during the year, each employer will deduct these taxes on your maximum earnings base. If there is an overpayment, you may claim a refund on your income tax return for the year.
APPLYING FOR BENEFITS
You are entitled to a retirement benefits if you are fully insured (which means you have earned the required number of credits to qualify) and you are at least age 62, and you file a claim with a Social Security office.
We suggest you talk to a Social Security representative a few months before the year in which you plan to retire. Prompt filing is important. Delay may mean fewer payments, because retirement benefits may be paid for up to only 6 months retroactively. Even if you don’t plan to retire, it is important to contact Social Security 3 months before you or your spouse reaches age 65 to arrange for Medicare insurance coverage. If you want until the month you reach age 65 or later, you may delay your coverage and may have to pay a higher premium for Medical Insurance Part B.
IF YOU BECOME DISABLE
If you should become severely disabled, you and your dependents can start drawing monthly Social Security benefits (after a 5 month waiting period) just as if you reached full retirement age. However, you must be under full retirement age and insured for disability benefits and you must apply. To be eligible, you need medical proof showing that you are unable to perform any substantial work for pay because of a severe physical or mental disability, and that the disability has lasted, or is expected to last 12 months or more, or will result in death.
Monthly survivor benefits are available to the following beneficiaries if you are insured by Social Security when you die (regardless of your age). Your surviving spouse at age 60 (or over 50-59 if disabled), or at any age if caring for your child (under 16 or disabled before age 22) who is entitled to benefits. Your dependent unmarried children under age 18 and those 18 and over who became disable before age 22 and remain disable and your dependent parents age 62 or older.
In addition to the monthly benefits survivors receive, the deceased worker’s eligible spouse is entitled to a one time lump sum death benefit of $225.00. If there is no spouse, this payment can be made only to a child entitled to survivor’s benefits.
For more information on Social Security benefits, call toll free 1-800-772-1213 or visit the internet site at www.socialsecurity.gov For Medicare benefits, call toll free 1-800-MEDICARE or visit www.medicare.gov