Avoiding Common Errors with Your Social Security Check

Many retirees leave money on the table or face unexpected cash flow issues due to simple misunderstandings of the Social Security system. To protect your income in 2027, avoid these common missteps:

• Assuming the Earnings Test is a Permanent Tax: When the SSA withholds benefits because you earned too much before your FRA, that money is not lost forever. It is credited back to you through higher monthly payments once you reach Full Retirement Age. Do not turn down a lucrative work opportunity simply because you fear the earnings test.
• Ignoring State Taxes: While federal tax rules apply universally, state taxation of Social Security varies wildly. Several states still tax Social Security benefits based on varying income brackets. Verify your state’s current tax laws, as relocating or crossing a state income threshold can change your net benefit.
• Forgetting to Appeal IRMAA: If you receive an IRMAA notice for 2027 based on your 2025 income, you do not always have to accept the premium hike. If you experienced a qualifying life-changing event—such as retiring, losing a pension, or divorce—you can file Form SSA-44 to request a reduction in your Medicare premiums based on your current, lower income.