Friday, January 29, 2016

Social Security expands "deeming" requirement on some couples, as per HR 1314; some dependents on those with suspended benefits lose out

There is a lot of hoopla about a recent trojan change in Social Security included in with HR 1314 late in 2015.

First, a good thing is that it extended any threat from the debt ceiling until early 2017 (for a new president), so there’s no threat of disruption from another round of “parlor timocracy”.  Social Security explains that here.

Further, it seems that some funds were moved from retirement to disability through 2022, which might some day destabilize the retirement fund.

But the main course is the extension of “deeming” for couples to age 70 (it had been through full retirement age at 66).  It also means that those receiving subordinate benefits (like spouses, ex-spouses, and certain other dependents) on the basis of a primary worker who has suspended his or her benefits, will soon stop receiving the benefits.  Forbes explains this best in an article by Laurence Kotikoff, Oct. 28, 2015.    There are a lot of other catchy links about this problem on the web (and scare ads on newspaper sites) that provide little or no real explanation.  But this seems to be the first time people receiving existing benefits will be cut off.

Again, the bill seems to penalize people with complicated relational or family situations and with less personal independence.

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