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Special Payments After Retirement
2024
Special Payments After Retirement
Bonuses, Vacation Pay, Commissions, Sick Pay,
Insurance Commissions, Carryover Crops, and Other Special Payments
What are “special payments”?
After you retire, you may receive payments
for work you did before you started to receive
Social Security benets. Usually, those
payments will not affect your Social Security
benet if they are for work done before you
retired. This fact sheet describes some of the
more common types of special payments, helps
you to decide if you received any, and tells you
what steps to take if you did.
What qualies as a special payment?
If you worked for wages, income received
after retirement counts as a special payment.
This applies if the last task you did to earn the
payment was completed before you stopped
work. Some special payments to employees
include bonuses, accumulated vacation or sick
pay, severance pay, back pay, standby pay,
sales commissions, and retirement payments.
Another example of a special payment is
deferred compensation reported on a W-2 form
for 1 year but earned in a previous year. These
amounts may be on your W-2 in the box labeled
“Nonqualied Plan.”
If you were self-employed, any net income you
receive after the 1st year you retire counts
as a special payment. This applies if you
performed the services before your entitlement
to Social Security benets. “Services” are any
regular work or other signicant activity you do
for your business.
Some special payments to self-employed
people include:
• Farm agricultural program payments.
• Income from carryover crops.
• Income gained by an owner of a business
who does not perform signicant services in
that business.
How do earnings limits
affect benets?
If a person who gets Social Security retirement
benets is younger than their full retirement
age, there are limits to how much they can earn
from work before it affects their benets. Your
full retirement age varies based on the year you
were born. You can visit www.ssa.gov/benets/
retirement/planner/ageincrease.html to nd
your full retirement age. We reduce benets, if
earnings exceed certain limits.
• If you are younger than your full retirement
age, we deduct $1 in benets for each $2
you earn above the earnings limit. In 2024,
the limit is $22,320.
• In the year you reach your full retirement
age, we reduce your benets $1 for every $3
you earn above the earnings limit. In 2024,
the limit is $59,520.
• Starting with the month you reach full
retirement age you can receive full benets
no matter how much money you earn.
If you think you received a
special payment
If you get Social Security and your total yearly
earnings exceed the limit, and these earnings
include a special payment, contact us. Tell us if
you think you received a special payment. If we
agree, we will not count that special payment as
part of your total earnings for the year.
SSA.gov
Example of a special payment
This example shows how we apply a special
payment under our rules:
Mr. DeSilva retired at age 62 in November 2023
and began to receive Social Security benets.
In January 2024, Mr. DeSilva receives a check
from his employer for $20,000 for his leftover
vacation time. Because this is vacation pay
he earned before he retired, we’ll consider it a
special payment and won’t count it toward the
earnings limit for 2024.
Insurance salespeople and farmers
There are 2 specic occupational groups that
commonly receive earnings which qualify
as special payments. They are insurance
salespeople who receive renewal or repeat
commissions and farmers who receive income
from carryover crops.
Insurance salespeople
Many insurance salespeople continue to receive
commissions after the year they retire for
policies they sold before retirement. This income
will not affect their Social Security benets, as
long as the income was the result of work done
before they retired.
Farmers
Many farmers harvest and store crops 1 year for
sale in another year. Farmers may fully harvest
and store crops before or in the month they
become entitled to benets, and then sell them
in the next year. Those earnings will not affect
benets for the year they receive the money.
Contacting Us
The most convenient way to do business with
us is to visit www.ssa.gov to get information
and use our online services. There are several
things you can do online: apply for benets;
start or complete your request for an original
or replacement Social Security card; get useful
information; nd publications; and get answers
to frequently asked questions.
When you open a personal my Social Security
account, you have more capabilities. You can
review your Social Security Statement, verify
your earnings, and get estimates of future
benets. You can also print a benet verication
letter, change your direct deposit information
(Social Security beneciaries only), and get a
replacement SSA-1099/1042S. Access to your
personal my Social Security account may be
limited for users outside the United States.
If you don’t have access to the internet, we
offer many automated services by telephone,
24 hours a day, 7 days a week, so you may not
need to speak with a representative.
If you need to speak with someone, call us
toll-free at 1-800-772-1213 or at our TTY
number, 1-800-325-0778, if you’re deaf or
hard of hearing. A member of our staff can
answer your call from 8 a.m. to 7 p.m., Monday
through Friday. We provide free interpreter
services upon request. For quicker access to
a representative, try calling early in the day
(between 8 a.m. and 10 a.m. local time) or
later in the day. We are less busy later in
the week (Wednesday to Friday) and later
in the month.
Social Security Administration
Publication No. 05-10063
January 2024 (Recycle prior editions)
Special Payments After Retirement
Produced and published at U.S. taxpayer expense
