New Social Security Rules to End Key Filing Strategies

[Purveyor]

By Anne Tergesen
Oct. 31, 2015 11:12 a.m. ET
8 COMMENTS

Congress is putting an end to two Social Security filing strategies that many couples have used to add tens of thousands of dollars to their retirement incomes. But there’s a six-month window in which couples who are at least 66 can still take advantage, as well as a partial reprieve for some others.

The implications of the new Social Security rules became clearer Friday after the Senate passed the budget bill that includes the changes. The measure will become law after President Barack Obama signs it.

The strategies under fire—known as file-and-suspend and a restricted application for spousal benefits—have made it possible for both members of a couple who are 66 or older to delay claiming benefits based on their own earnings records while one pockets a so-called spousal benefit based on the other’s earnings.

To do this, one individual files for benefits and suspends them, while the other files a restricted application to collect only a spousal benefit—not his or her own earned benefit even if it would be higher. That way, both individuals can take advantage of delayed retirement credits, which increase their earned benefits by 6% to 8% for each year in which they defer claiming between the ages of 66 and 70—and one gets some income from Social Security in the meantime.

more...

http://www.wsj.com/articles/new-social-security-rules-to-end-key-filing-strategies-1446304336

[Nye Bevan]

1. I would definitely have used this strategy myself if it had not been shut down.

But I admit it was kind of a gimmicky loophole and I can't really complain about it being abolished.

[elias49]

2. Loopholes are all the 99% have left.

I have no qualms about grabbing an edge when I can.

[Skittles]

3. as a single person I think it is best to do this than across the board cuts

although I have no doubt they will end up doing that too