Working Seniors: Social Security & Taxes

0:00It's March 24. Durham News Today starts now. AI-powered and ready. About one in five Americans, over age 65, either worked or looked for work last year. Of those, nearly 40% held part-time jobs. Sticking with employment later in life often boosts health, daily routines, and even lifespan, but it comes with key financial catches, mainly around social security and taxes. Many seniors keep working past age 62. When they could first claim benefits, either to delay for bigger payouts at full retirement age, or simply for personal fulfillment. Higher earners often choose it for enjoyment, while others need the cash to cover gaps. Taxes kick in on social security benefits, if your provisional income. Your adjusted gross income, plus non-taxable interest, and half your benefits tops. Certain levels. Singles pay on up to 50% between $25,000 and $34,000, or up to 85% above that.

1:02Merry couples filing jointly started $32,000 and $44,000. These fixed thresholds do not rise with inflation, so more folks get hit now. On top of that, workers pay 6.2% payroll taxes into social security on earnings up to the wage cap, which can add thousands yearly for solid incomes. Delaying benefits while employed makes sense for some, potentially hiking monthly checks by up to 24% past full retirement age. In the end, deciding when to retire or claim benefits boils down to your unique finances, health needs, and goals, so crunch the numbers carefully. Before jumping in.