How Taxpayers Can Check Their Social Security Statement and Status

by | Jun 8, 2022 | CPA Tips

How Taxpayers Can Check Their Social Security Statement and Status
“Except for an occasional heart attack I feel as young as I ever did.” – Robert Benchley

The paper never seems to stop from all your investment accounts, IRAs, bank accounts and all the other components of your nest egg. There’s another one that you should special attention to, though: your annual Social Security statement

On it, you’ll see what you’ve socked away through your work life and how much you can expect to get back from Uncle Sam every month after you retire. Knowing how to get it and read it is a key part of planning for your golden years — whether you plan to stay here in or decamp elsewhere.  

What’s on your statement

If you’re still paying into the system, you can get a statement regarding your earnings history and expected Social Security benefits – pretty useful if you’re closing in on retirement and need to start budgeting. 

If you collect Social Security, your Benefit Statement (aka SSA-1099 or the SSA-1042S for tax purposes) shows you the total amount of benefits you received from Social Security in the past year. This tells you how much Social Security income to report to the IRS on your tax return. 

For many years, nearly every American who was actively paying Social Security tax received an annual earnings statement from the Social Security Administration (SSA). You got a statement every five years if you are under the age of 60, and every year if you are over the age of 60. 

That was efficient. But with budget cuts, that paper mailing has been on and off from the SSA for years. Lawmakers do want to see paper statements mailed to more workers, claiming the practice keeps people thinking about retirement saving and helps prevent fraud. 

There’s no doubt about the first point: Your Social Security earnings determine your eventual benefits. You’ll want to monitor your statements to confirm your earnings and verified credited wages every year. Most likely there will be no goofs but check anyway – better you catch ASAP if the SSA has failed to post earnings or posted earnings that are too low. 

The annual earnings statement tells you a lot more to help you plan for retirement, including your estimated benefits at the time of your full or early retirement; estimated benefits for disability insurance (frequently an under-appreciated benefit); and survivor benefit information.

You can also see your earnings record from as long as you’ve been working and what Social Security and Medicare taxes you’ve paid over that time. 

How to get your statement online

While you wait for SSA to make up its mind about continuing to mail paper statements, you may want to check out your online option. You’ll need a my Social Security account, which the SSA claims takes about 10 minutes to set up. 

If you receive Social Security (or have Medicare), you can use your account to get your benefit verification letter; check your benefit and payment info; change your address, phone number or direct deposit info; request a replacement Medicare card; or report your wages if you work and receive Social Security disability insurance or Supplemental Security Income (SSI) benefits. 

To retrieve your annual statements online, you need to be at least 18 years old and have a valid email address, a Social Security number (SSN) and a U.S. mailing address. Got all that? Then register here. They’ll ask for such personal information as your name, SSN, date of birth, address and phone number. 

Answer a few personal questions to help protect against fraud then put in your username, password, email and security questions. Like on every site these days, the password has several fiddly requirements and you have to remember to agree to the terms of service. 

The good folks at SSA redesigned statements, promising plain language, clear sections and with a pretty bar graph showing your personalized retirement benefit estimates at nine different ages depending on when you want your benefits to start. There’s also Medicare info. 

Fact sheets tailored to your age group and earnings situation come with your online statement. For younger workers, SSA shows more information about how to save for the future; older workers get explanations of how benefits may be taxed and how to avoid a Medicare penalty. 

And of course, your revamped statement has your earnings history and info on how to report an error if you find one. The SSA encourages you to review your statement annually. 

So do we.   
   

And again, allow me to repeat my offer to stand in your corner during these trying times. Use this:
meetings.hubspot.com/paulina-szuszkiewicz

(And feel free to send this along to someone who might need this kind of help.) As I’ve said, helping people like you with all of your tax needs is what my team and I love to do.

In your corner

Paulina Szuszkiewicz