The Social Security earnings limit is the maximum amount of money you can earn while still receiving your full Social Security benefits. If you earn more than the limit, your benefits will be reduced.
The earnings limit for people who have not yet reached full retirement age is $1,770 per month or $21,240 per year in 2023. If you reach full retirement age in 2023, the limit on your earnings for the months before full retirement age is $56,520. Once you actually attain full retirement age, the earnings limit goes away.
The income that counts towards the earnings limit is employment income, which means gross employment wages if you're an employee and/or your net earnings from self-employment. The earnings caps are adjusted annually for national wage trends, and they differ depending on how close you are to full retirement age.
There is a special rule that lets the SSA pay a full Social Security check for any whole month they consider you retired, regardless of your yearly earnings. This rule can be used if you are working part-time or if you have a seasonal job.
Other considerations
If you receive Medicaid:
The income ceiling for Medicaid varies by state, but it is generally based on the federal poverty level (FPL). In 2023, the FPL for a single person is $14,580. This means that a single person in most states would be eligible for Medicaid if their income is below $14,580.
However, there are some states that have expanded Medicaid eligibility to include adults with incomes up to 138% of the FPL. This means that an adult in these states could be eligible for Medicaid if their income is up to $21,240 in 2023.
The income ceiling for Medicaid also depends on household size. For example, a family of four in most states would be eligible for Medicaid if their income is below $37,100 in 2023.
It is important to note that the income ceiling for Medicaid is just one factor that determines eligibility. Other factors, such as age, disability, and pregnancy, may also affect eligibility.
Owning property does not necessarily disqualify you from receiving Medicaid. However, the value of your home and other assets may affect your eligibility.
In most cases, your primary home is exempt from the asset limits for Medicaid eligibility. This means that the value of your home will not count towards your assets when determining eligibility. However, there are some exceptions to this rule. For example, if you own a second home or a vacation home, the value of those homes will count towards your assets.
The value of your other assets, such as savings accounts, investments, and vehicles, may also affect your eligibility for Medicaid. In general, you cannot have more than $2,000 in countable assets to qualify for Medicaid. However, there are some exceptions to this rule, such as if you are blind or disabled.
If you are considering applying for Medicaid, it is important to talk to an elder law attorney or other financial advisor to discuss your specific situation. They can help you understand the asset limits for Medicaid in your state and how owning property may affect your eligibility.
Here are some additional things to keep in mind about owning property and receiving Medicaid:
- If you sell your home, the money you receive from the sale will count towards your assets.
- In high cost states selling your home with a low basis may cause you owe income tax and capital gains tax.
- Balancing act of not paying extra taxes when you are retired takes planning
- If you give away your home, the value of the home will count towards your assets for a period of time. Gift taxes limit the amount the dollar amounts you can give to family.
- If you live in a nursing home, Medicaid may place a lien on your home to ensure that it can be repaid for the cost of your care.
It is important to plan ahead if you are considering applying for Medicaid and own property. By working with an elder law attorney or financial advisor, you can make sure that you are aware of the rules and regulations and that you are taking steps to protect your assets.