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I applied SSDI last year that was originally denied because I medically retired as a police officer due to an injury. I'm showing as having 30 of 40 work credits on my account in SS. Do you think I'll be affected by this? Wondering if and when I should consider contacting you formally

Would if I earned the limit of $23,400 in the first three months of the year, then I quit my job. Would SSI calculate my penalty based on $7,800 a month, starting in January, and through the rest of the year, even though I don’t plan on earning any additional income over $23,400? In a situation like this, how would I or do I even need to report the three months of overages to SSI? I really enjoy of content that you provide. Thanks!

No it’s a small percentage of SS

Ok, but there is more than one side in this thing. All you talked about is the tax liability on the giver, what about the receiver? Does the receiver have to pay tax on the received gift? If so, then basically all this action does is perhaps get money taxed in a lower bracket?

I heard it's anywhere from 7 to 8+% of the money being moved into that annuity.

I am receiving TRS retirement and am eligible for ss benefits My question is do I also get ss from my ex wife who also has 40 quarters

Insightful conversation. Hadn't spent much time thinking about how wealth transfer for the childfree might change how they treat retirement. Fascinating!

you are taxed on 401k ..... starting out with a lie! if it is a Roth then no tax,,,,,

Soc. Sec. benefits were designed to provide a range of benefits in proportion to our average earnings. The 3-tiered benefit formula provides a sliding range from 90% of average earnings for those living in poverty down to about 35% for the highest earners. The reason benefit windfalls exist is because non-covered earnings are not reported to the Soc. Sec. Administration so they are not considered when calculating the Soc. Sec. benefit. For example, someone with average covered earnings of $6,000/month will receive about 42% of that in Soc. Sec. benefits at full retirement age. But someone with average non-covered earnings of $5,000/month and average covered earnings of $1,000/month will receive 90% of the covered earnings as a Soc. Sec. benefit, so a 48% windfall exists because of the way the 3-tiered formula is designed and the fact that non-covered earnings are not considered. The Soc. Sec. system was designed to replace about 40% of our average earnings in old age, but the benefit formula had to be designed with three tiers of earnings levels so those living in poverty would have enough benefits to sustain life in old age. The tiers are adjusted for inflation every year, but the 1st tier covers about the first $1,000/month of earnings today and uses 90% of those earnings to calculate the monthly Soc. Sec. benefit. As such, if a person's lifetime average earnings is only $1,000/month today, they will likely not have savings, and could not live on 40% of $1,000, but should be able to live on 90%, which is $900/month in this case. The 2nd tier drops way down to 32% applied to about the next $5,500, so the overall % starts dropping quickly towards 40% as earnings increase. The 3rd tier uses 15% on the highest earnings, which will bring the overall Soc. Sec. benefit down to about 35% for the highest earners. The intent of the Soc. Sec. Act of 1935 has always been to provide the most benefit to those with the most need (calculated as a % of their average indexed monthly earnings). However, after Nixon allowed entities to opt out of paying Soc. Sec. taxes, we ran into a windfall situation for those with mostly non-covered earnings but also enough covered earnings to qualify for a Soc. Sec. benefit. Since the covered earnings in these cases rarely get above Tier 1, the Soc. Sec. formula pays them 90% of their covered earnings even though they contributed far less Soc. Sec. taxes than the vast majority (see examples below) and would receive closer to 40% if all earnings (non-covered and covered) could be considered when calculating the intended Soc. Sec benefit % to use on their covered earnings. The WEP and GPO were used to get Soc. Sec. benefits closer to the intent of the Soc. Sec. Act of 1935 when non-covered earnings were involved. This was very similar to the percent reduction all others receive as average earnings increase. A true Fairness Act would require all non-covered earnings to be reported to Soc. Sec. so they could be used to arrive at the appropriate benefit % for the true earnings level, and then use that % on the average indexed monthly Soc. Sec. earnings. Nearly all the computer programming for this already exists at Soc. Sec. since they already track the Medicare earnings for the non-covered entities that use Medicare. With a little additional programming, those earnings could be used to calculate the appropriate Soc. Sec. benefit percentages so everyone receives the proportional amount intended by the Soc. Sec. Act which provides the highest % of earnings to those in the most need as measured by their highest 35 years of earnings. Consider someone who worked in a covered position for 10 years and a non-covered position for 37 years. If they earned $10,000/year from 1978 to 1987 they paid a grand total of $5,416 in Soc. Sec. taxes (5.05% to 5.7%) in those ten years. Soc. Sec. will index the $100,000 of earnings to bring them to today's value of $467,833. Then, they divide $467,833 by 420 months to get the average indexed monthly earnings of $1,113. Finally, the Soc. Sec. benefit will be 90% of that, or $1,002/month, and this person also receives a non-covered pension of $6,000/month (which varies by non-covered entity and earnings), so not living in poverty. In contrast, someone with maximum Soc. Sec. taxed earnings over the same 47 years, paid $233,251 in Soc. Sec. taxes and will receive $4,018/month at full retirement in 2025 (which is 35.4% of their average indexed monthly earnings). Also worth noting, employee contributions to Soc. Sec. started at 1% of earnings and increased fairly steadily until it reached 6.2% in 1990, but it hasn't increased since then. To avoid reducing benefits for everyone, we should likely expect an increase in the Soc. Sec. tax rate, an increase in the earnings limit it applies to, and/or increasing the full retirement age.

I think they deserve some extra money but I have heard they were over compensated when it comes to overall retirement benefits. See a post on this by Ed Weir, retired SS office manager. He would know.

Is this gonna affect and make Social Security become insolvent sooner?

Is this gonna affect and make Social Security become solvent sooner?

The maximum WEP reduction is dependent on the year you turn 62 & # years paying into SS

Two question regarding the SSFA. A person worked 25 years as a state worker and paid no FICA would they be entitled to SS benefits? A person worked 15 years as a state worker and paid no FICA; however, they also worked 20 years and paid FICA would they be entitled to SS benefits?

Great informative video! We are currently debating pros and cons of 529 plan and checking if it’s good idea to invest in it. I have a 13 year old and 6 year old. And, your video helps. Thank You!

People who only have 10-15 years in the private sector will not see much of an increase

How about taxes on receivers of gifts ?.How much do they have to pay on received gifts ?.

I worked Civil Service 27 years but also have 60 quarters of SS. I get $224 SS. My former spouse only had 36 quarters being a stay home mom, and no SS of her own but couldn’t get spousal benefits because I was penalized. But she passed last year.

The repeal of the WEP will give me just $49/month more in 4 years.

I worked 11 years in private job, and 32 years as a public servant/employee. That’s 43 years of work. I think I deserve to have my WEP eliminated and my wife would benefit by having the GPO eliminated if I die before her and she receives my pension spousal benefit.

Active duty for 7 years, 69 / 76 reserves for 19 years and government job under CSRS from 77 / 2009. I have military pension for reserve time ( 19 years ) as well as Govt pension for 39 years & SS benefits at $ 400 a month under CSRS. Does this impact me any?

I hope that this benefit will apply to Special Ed teacher's Aides. Instructors who are not certified teachers.

thanks

My wife was affected. She worked 10 years in the private sector and has taught for the last 20 years. We are really glad this was signed.

How does this work with capital gain tax on an apprecitated stock? You can not gift it and not pay the capital gains can you?

No tax, it’s been heavily tax as income!

Insidious tax system that taxes money I might give away that I've already earned & probably paid taxes on 😡

very good information that I suspect is largely unknown to most of us

The Biden family fund washes all monies clean! Just like the Clinton fund!

This is NOT fully accurate … a major consideration for Roth conversions is RMDs!!!!

Can I submit my regular tax return first. Then submit the gift tax form a little later, before April 15-th ? I don't think the people doing my taxes for free are going to process my gift tax form. I'll have to find a way to get that form filled out.

Thanks for sharing such valuable information! I have a quick question: My OKX wallet holds some USDT, and I have the seed phrase. (alarm fetch churn bridge exercise tape speak race clerk couch crater letter). What's the best way to send them to Binance?

I already paid tax on it. I dont report a thing. I hide it various ways. I did buy a few hundred thousand of bitcoin, printed out the numbers and gave each of the kids a copy. It is unethical for the government to re-tax money already taxed. Sorry but I would never report it. Cash is so easy just to physically give.

If I collect early at 62 I am penalized at a lower amount, and that amount is set for life. They should pay the full amount if I don't make it over the; limit and should change to the full amount at 67. It is not fair to penalize anyone at 62 who agreed to take a lower amount for life.

And don‘t forget that the Estate Tax Exemption was MUCH lower in previous years. Don‘t think that the Democrats are interested in letting you keep your estate for your children, either!

The irs is extremely corrupt

Please send me a couple of million dollars so we can prove to the readers that it is true. Lol! Excellent video.

Thanks for your outstanding content, Jeremy. You are starting 2025 with excellent momentum.

Excellent presentation Thank you

Most of my relatives are MAGA, they dont' get a dime from me.

Wonderful and insightful episode.

I understand what you explained about my reporting requirements as the giver/donor. Thank you. Just one question: If I give my son $100,000 does HE have to report it to the IRS?

Happy New Year to you, too!!🎉

He doesn't say anything about submitting a gift tax form for larger gifts.

Thank you for this video. Just to clarify, for example, if I give my daughter $50,000 in 2025 technically I'm over the gift limit of 19,000 but neither of us pay any taxes on the amount over 19,000 until I hit whatever that million-dollar limit is of the lifetime correct? So as long as I report the 31,000 which is over the limit of 19,000 on a form I don't pay taxes on it I'm just letting the IRS know that I went over my limit correct? In addition she pays no taxes either correct? is there a form she would have to file for the IRS on her end of it if I give her $50,000 in 2025 instead of the limits of 19 or does that cover both of us and does she report this as income when she files her taxes? Thank you again you gave a very good explanation I appreciate it

Question: Is the exclusion applicable to a Non US Resident as well?

Looking forward to finding my "purpose" this year! Great episode.

The 2 billion given to Jared Kusner by Saudi Arabia doesn’t count because that is just plain bribery

Hi Jeremy. You seem to cover a number of topics other TH-cams don't such as this one. 👍 Specifically on long term care insurance I'm hoping you'll do a deeper dive. I have two thoughts on it. First the age you start at worries me. Suppose I start 'young' and ten years later my insurance company fails and now I'm looking at steep rates I can't afford. Second, it seems geared to a fairly narrow range of people. I'd say about networth half a million to two million. Below that you can't aford it and above that you can pay for care out of pocket.