What the income limit actually does

Social Security has an income limit only if you are under full retirement age and still working. If you earn more than a set amount per year, Social Security reduces your benefit payment — it does not stop it entirely, and it does not affect your may be able to access to receive benefits at all.

The limit applies to earned income only: wages from a job, net self-employment income, and certain royalties. It does not count investment income, pensions, rental income, or other unearned money. The year you reach full retirement age, the limit applies only to earnings before the month you turn that age.

Once you reach full retirement age, there is no income limit. You can earn as much as you want and keep your full benefit payment.

Key Takeaways

  • The income limit applies only to people under full retirement age who are receiving Social Security benefits and still working.
  • For 2024, Social Security reduces your benefit by $1 for every $2 you earn above $23,400 (the exact amount changes each year).
  • In the year you reach full retirement age, a different limit applies to earnings before the month you turn that age.
  • Investment income, pensions, and rental income do not count toward the limit — only wages and self-employment income do.
  • Once you reach full retirement age, you can work and earn without any reduction to your benefits.

The dollar amounts and how the reduction works

Social Security publishes a new earnings limit each year. For 2024, the limit is $23,400 per year. If you earn more than that, your benefit is reduced by $1 for every $2 you earn over the limit.

Example: You are 62 and receiving Social Security. You earn $30,000 in 2024. You are $6,600 over the limit. Social Security reduces your benefit by $3,300 (half of $6,600). If your monthly benefit is $1,500, you would lose $3,300 for the year — roughly $275 per month.

The limit amount changes each January based on changes to the national average wage. The Social Security Administration publishes the new limit in October or November of the previous year. You can find the current year's limit on the Social Security website or by calling 1-800-772-1213.

How the limit works in the year you reach full retirement age

In the year you turn full retirement age, a higher limit applies — but only to earnings before the month you reach that age. For 2024, this limit is $62,400. After the month you turn full retirement age, no limit applies for the rest of that year or any year after.

The reduction for earnings before full retirement age is also different: $1 reduction for every $3 earned over the limit, not $1 for every $2. This means the hit to your benefit is smaller in that final year.

Example: You turn 67 (full retirement age) in June 2024. From January through May, the $62,400 limit applies. Starting in June, no limit applies. If you earned $70,000 from January through May, you are $7,600 over the limit. Your benefit is reduced by about $2,533 for the year (one-third of $7,600).

Who is not affected by the income limit

If you have already reached your full retirement age, the income limit does not apply to you, no matter how much you earn. You receive your full benefit payment every month.

If you are under full retirement age but not yet receiving Social Security benefits, the limit does not apply. You can work and earn as much as you want. The limit only kicks in once you start taking benefits.

If you are receiving benefits as a spouse, widow, or dependent based on someone else's record, the same rules apply to you based on your age and earnings — not the person whose record you are on.

What counts as earnings and what does not

Wages from employment count. So does net income from self-employment (your profit after business expenses). Certain royalties from creative work also count if you are still involved in the work.

These do not count: interest and dividends, capital gains, rental income (unless you are a real estate dealer), pensions, annuities, insurance payouts, gifts, or inheritances. Bonuses and back pay count as earnings in the year you receive them, even if they are for work done in a previous year.

If you are self-employed, you report your net earnings on your tax return. Social Security uses that same figure. If you have not filed your tax return yet, you can estimate your earnings and report them to Social Security; you will need to correct the figure later if it changes.

Reporting your earnings to Social Security

You are required to report your earnings to Social Security if you expect to earn more than the annual limit. You can report online through your my Social Security account, by phone at 1-800-772-1213, or by mail using Form SSA-777.

You must report your earnings by April 15 of the following year — for example, report 2024 earnings by April 15, 2025. If you do not report and Social Security overpays you, you will have to repay the overpayment. Reporting on time prevents this problem.

If your earnings are lower than you expected, you can report the lower amount and may receive a larger benefit for part of the year. If your earnings are higher, reporting prevents an overpayment notice later.

What happens if you earn more than expected

If you earn more than the limit and do not report it, Social Security will eventually discover the overpayment when it matches records with the IRS. You will receive a notice asking you to repay the money. You can request a waiver of the overpayment if you can show you were not at fault and repayment would be a hardship, but this is not automatic.

If you report your earnings promptly, Social Security adjusts your benefit payments during the year rather than creating an overpayment you have to repay later. This is much simpler and avoids collection action.

If you believe the reduction is wrong — for example, if you reported earnings incorrectly or if Social Security made an error — you can request a recalculation. Contact your local Social Security office or call 1-800-772-1213 to ask about the process.

Frequently Asked Questions

Does the income limit affect my spouse's benefits?

No. The income limit applies only to the person whose earnings they are. If you are receiving benefits as a spouse based on your partner's record, your benefits are not reduced because of your partner's earnings. Your benefits are reduced only if you earn over the limit and you are under full retirement age.

What if I work part-time or have irregular income?

The limit is based on your total earnings for the calendar year, not monthly income. If you work part-time or have months with no income, you average it across the full year. Report your expected annual earnings to Social Security, and adjust if the actual total is different.

Can I work for myself and avoid the earnings limit?

No. Self-employment income counts the same way wages do. Your net profit (after business expenses) is subject to the limit if you are under full retirement age and receiving benefits.

Does the income limit apply if I am receiving disability benefits?

No. The earnings limit applies only to people receiving retirement or family benefits and who are under full retirement age. If you are on Social Security Disability Insurance (SSDI), different work rules apply, and you should contact Social Security directly about how work affects your benefits.

What if I turn full retirement age mid-year?

The higher limit ($62,400 in 2024) applies only to earnings before the month you turn that age. Once that month arrives, no limit applies for the rest of the year. Report your earnings for the months before full retirement age separately from earnings after.