The Social Security Administration has implemented a variety of new rules and
features for 2013. The two-year payroll tax cut has officially ended, and paper
Social Security checks will soon cease to be printed. A growing number of Social
Security services will also be online this year. Here's a look at some of the
recent Social Security changes that go into effect this year:
Payroll tax cut ends. The temporary payroll tax cut was
allowed to expire at the end of 2012. Workers who paid 4.2 percent of their
income into the Social Security system in 2011 and 2012 will now resume
contributing 6.2 percent of their earnings in 2013, up to the payroll tax cap of
$113,700.
Higher payroll tax cap. The payroll tax cap increased by
$3,600, from $110,100 in 2012 to $113,700 in 2013. Workers who earn more than
this threshold don't need to pay Social Security taxes on that income.
More online services. A trip to the Social Security office
is no longer necessary to start your Social Security payments. A growing number
of retirees are claiming Social Security payments online, largely thanks to an
advertising campaign starring actors Patty Duke and George Takei. For the first
time in 2012, workers could access their Social Security statements online,
including their complete earnings history and expected payments, and about 3
million people have already done so. In early 2013, Social Security added online
services including the ability to access a benefit verification letter and
payment history. Retirees can also change their address and start or change
direct-deposit information online. "The ability to do this online, it will be a
real convenience for the people who are required to have these benefit
verification letters," says Social Security Commissioner Michael Astrue. "It is
going to allow us to focus on the kind of conversations that we really do need
to have face to face."
Reduced office hours. Social Security offices are reducing
the hours they are open to the public to save money and avoid paying overtime to
workers. Social Security locations nationwide have been closing 30 minutes early
each day since Nov. 19, 2012, and they began closing to the public at noon every
Wednesday on Jan. 2, 2013.
Paper checks will end. On March 1, 2013, the Treasury
department will stop mailing paper checks to Social Security recipients.
Retirees will be required to choose to have their Social Security payments
either directly deposited into a bank or credit union account or loaded onto a
prepaid Direct Express Debit MasterCard. "If you already have a bank account or
credit union account, we encourage you and it's our preference that you sign up
for direct deposit," says Walt Henderson, director of the electronic fund
transfer strategy division at the Treasury Department. "The debit card is
primarily for unbanked benefit recipients. We don't want people who already have
a bank account to feel that they have to get the debit card." New Social
Security beneficiaries have been required to choose an electronic payment option
since May 2011, and approximately 93 percent of Social Security and Supplemental
Security Income (SSI) payments are already being made electronically.
Higher earnings limit. People between ages 62 and 66 who
work and collect Social Security benefits at the same time might have part or
all of their Social Security benefit temporarily withheld. Workers between ages
62 and 65 can earn up to $15,120 in 2013, after which $1 in benefits will be
withheld for every $2 of income above the earnings limit. People who turn 66
this year can earn up to $40,080, and then $1 of benefits will be withheld for
every $3 earned above the limit. However, once you turn age 66, the earnings
limit no longer applies. And benefits may be recalculated at age 66 to reflect
the withheld benefits and continued earnings.
Bigger payments. Social Security beneficiaries began
receiving payments that were 1.7 percent larger in January 2013. The average
monthly Social Security benefit in January increased from $1,240 to $1,261 as a
result of the cost-of-living adjustment.
Article Source: Yahoo!
