Today, many people want to supplement their retirement and Social Security incomes by working.

See also: 25 things to know about Social Security

This FAQ sheet provides information on how employment earnings affect Social Security benefits.

Can I get full Social Security benefits if I work?

 It depends.

• If you are full retirement age, you can work and earn as much as you want and keep all of your Social Security benefits.
  
  
• If you are younger than full retirement age, you may receive all your benefits as long as your earnings are under the limits noted below.
  
  
• The full retirement age will increase gradually each year until it reaches age 67 for people born in 1960 or later.
  
  
• If you were of full retirement age or older in 2012, there is no limit on your earnings.
  
  
• If you are younger than full retirement age, for every $2 over the limit of $15,120, $1 is withheld from benefits.
  
  
• If you reach full retirement age in 2013, for every $3 over the limit of $40,080, $1 is withheld from benefits until the month you reach retirement age.

Will my wages be taxed?

Yes. All covered workers are subject to Social Security and Medicare Taxes (listed on your paycheck as "FICA" taxes), regardless of age.

Will I get any credit for these additional earnings?

You may be able to receive a higher benefit, because Social Security automatically re-computes the benefit amount after the additional earnings are credited to your record.

Do I need to notify Social Security if I earn more than the exempt annual amount for my age?

Yes. Promptly tell Social Security how much you expect to earn so the correct amount can be withheld. If you receive more benefits than you are entitled to by law, you will have to repay them. Also, there is a penalty if you do not notify Social Security of your expected income promptly. If your earnings are either lower or higher than you expected, or if you think your benefits are incorrect, be sure to notify Social Security. Remember, you are still required to file your income tax report by April 15 each year.

What counts as wages or earnings for Social Security?

In general, the Social Security Administration defines “earned income” as “income from wages or net earnings from self-employment.” For example, earnings may include bonuses, commissions, and severance pay. Investment income, pensions, capital gains, and inheritances are not considered wages. Other types of payment made by an employer may be considered earnings under certain conditions.

If you have questions about whether your earnings count as wages for Social Security purposes, or whether to count your earnings in the year you did the work or in the year you received the pay, contact Social Security.

Next page: Will my earnings affect my Medicare benefits? >>