Social Security Administration

525 Munson Ave.
Traverse City MI 49686

Monthly Information Package

March 2008


Columns

(1)  AMERICA SAVES FOR RETIREMENT

(2)  MEDICARE PART B DEADLINE APPROACHING

(3)  FIRST BABY BOOMER PAYMENT MADE BY DIRECT DEPOSIT

(4)  YOUNG WORKERS AND SOCIAL SECURITY: WHAT’S IT TO YOU? 

(5)  CAN’T FIND YOUR 1099? IT’S ONLINE! 

Features

QUESTIONS AND ANSWERS

Social Security Column 1

AMERICA SAVES FOR RETIREMENT 
By Bob Simpson
Social Security District Manager in Traverse City


Social Security is proud to be a part of the America Saves campaign.

America Saves is a nationwide campaign involving a broad coalition of more than 1,000 nonprofit, corporate and government agencies, groups and organizations. The campaign was designed to help individuals and families save and build wealth.

America Saves helps people by providing information, advice and encouragement on saving for important things like a home, education and retirement. 

Saving for retirement is a critical goal that sometimes gets forgotten in the day-to-day management of money.

According to financial experts, you will probably need at least 70 percent of your annual working income when you retire to enjoy a comfortable lifestyle. For the average American worker, Social Security will replace about 40 percent of his or her pre-retirement earnings. The remaining 30 percent will need to come from private pension plans, savings or investments. That’s why it’s important to save for your retirement — even if it’s not easy to part with those extra dollars.

Many people believe that low- and moderate-income families cannot afford to save and build wealth. Yet research shows that there are "savers" and "spenders" in all income levels and almost everyone has the ability to build wealth over time. 

We at Social Security share the goal of America Saves: to encourage all Americans to save, and to help them do just that.

You can also use the free resources provided by Social Security. Every year, about two to three months before your birthday, workers 25 and older receive a Social Security Statement in the mail. The Statement gives you an estimate, based on current earnings, of what you might expect in Social Security retirement benefits. And by using our online Retirement Planner, you can personalize various financial scenarios to determine what your individual retirement plan should look like. Visit the Retirement Planner at www.socialsecurity.gov/retire2.

For more information visit www.americasavesweek.org.



Social Security Column 2

MEDICARE PART B DEADLINE APPROACHING
By Bob Simpson
Social Security District Manager in Traverse City


If you didn’t sign up for Medicare Part B medical insurance when you first became eligible for Medicare, you now have an opportunity to apply — but time is running out. The deadline for applying is March 31, 2008. If you miss the deadline, you will have to wait until 2009 to apply.

Medicare Part B covers some medical expenses not covered by Medicare Part A (hospital insurance), such as doctors’ fees, outpatient hospital visits and other medical supplies and services that are not covered by Medicare Part A.

When you first become eligible for hospital insurance (Part A), you have a seven-month period (your initial enrollment period) in which to sign up for medical insurance (Part B). After that, you have to pay a higher premium — unless you were covered through an employer's group health plan or a group health plan based on a spouse's employment. You are given another opportunity to enroll in Part B during the general enrollment period, from January 1 to March 31 of each year. But each 12-month period that you are eligible for Medicare Part B and do not sign up, the amount of your monthly premium increases by 10 percent.

You can learn more about Medicare by reading our electronic booklet, Medicare (SSA Publication No. 05-10043) at www.socialsecurity.gov/pubs/10043.html. You may also call us toll-free at 1-800-772-1213 (TTY 1-800-325-0778) to ask for a copy. Or visit the Medicare website at www.medicare.gov. You may also call Medicare at 1-800-MEDICARE (1-800-633-4227; TTY 1-877-486-2048).




Social Security Column 3

FIRST BABY BOOMER RETIREMENT PAYMENT MADE BY DIRECT DEPOSIT
By Bob Simpson
Social Security District Manager in Traverse City


Baby boomers can be such trend-setters. Take the first baby boomer to receive Social Security retirement benefits, for example.

When Kathy Casey-Kirschling, the nation’s first baby boomer, decided it was time to retire, she applied online at www.socialsecurity.gov because she knew it was fast, convenient and secure.

And when the application asked her how she wanted to receive her first payment, she chose the safest, quickest and most convenient way — direct deposit.

No doubt, millions of baby boomers will follow her example. Here’s why:

* Direct deposit is safe. Your money goes directly to the bank in the form of an electronic transfer so there’s no risk of a check being lost or stolen. 

* Direct deposit is quick. You can sign up at www.socialsecurity.gov/deposit or call us toll-free at 1-800-772-1213 (TTY 1-800-325-0778). Your benefit will go automatically into your account every month and you’ll have more time to do the things you enjoy. 

* Direct deposit is convenient. You no longer have to stand in line to cash your check when it arrives, or leave your house in bad weather or worry if you’re on vacation or away from home. Your money is as close as your nearest ATM or just the click of a mouse away with online banking. 

For more information about direct deposit, go to www.socialsecurity.gov/deposit or visit www.GoDirect.org. To learn more about Social Security’s online services, go to www.socialsecurity.gov/onlineservices.



Social Security Column 4

YOUNG WORKERS AND SOCIAL SECURITY: WHAT’S IT TO YOU? 
By Bob Simpson
Social Security District Manager in Traverse City

If you’re a younger worker, retirement probably seems like a lifetime away. In fact, you may wonder if your contributions to Social Security, deducted from your paycheck, actually cover you for anything right now.

By working in a job covered by Social Security, you automatically get disability and survivor insurance protection. A worker under age 24 who pays Social Security taxes for just one and a half years is covered. A worker under age 31 who pays Social Security taxes for half the time elapsed since age 21 is also covered.

If you’re like most workers, you probably don’t have private long-term disability insurance. But you do have disability protection through Social Security, which will provide benefits to you and your family if you become disabled. About 3 in 10 of today’s 20-year-olds will become disabled before reaching age 67 — so it could happen to you. The average disability benefit paid to a worker with a spouse and two children in 2008 is about $1,690 a month.

Social Security also provides survivors benefits. It is a sad truth that about one of seven young Americans can expect to die before reaching age 67. Social Security’s survivors insurance pays an average monthly benefit in 2008 of $2,243 for a spouse and two children of a young worker with average wages who dies.

It’s good to think ahead to retirement, but Social Security is more than that. It provides you and your family with protection now.

For more information on how Social Security protects younger and older Americans alike, visit our website at www.socialsecurity.gov or call us at 1-800-772-1213 (TTY 1-800-325-0778).


Social Security Column 5

CAN’T FIND YOUR 1099? IT’S ONLINE!

By Bob Simpson
Social Security District Manager in Traverse City

We’re deep into tax season, and the days left for filing are numbered. Millions of taxpayers are busy gathering all the forms and documents they need to file their federal, state and local tax returns. 
It is important to remember that some people who receive Social Security may have to pay taxes on a portion of their benefits. If you’re one of these individuals, a Social Security Benefit Statement (Form SSA-1099) is an important tax document for you to have. 
If you normally don’t file a tax return and are doing so this year only because of the stimulus payment, you don’t need your 1099. But if you normally do file a tax return, you should be sure that you have one when you file this year.
The SSA-1099s for tax year 2007 were automatically mailed to beneficiaries by January 31, 2008. If you or someone you know who receives Social Security has not yet received a Form SSA-1099 for 2007, but need to file a tax return, there’s no need to worry. You can request a replacement online at www.socialsecurity.gov .
The SSA-1099 shows the total amount of benefits received in the previous year and is used to find out if any benefits are subject to tax, and to complete a federal income tax return. The federal tax laws about Social Security benefits state that: 

* Up to 50 percent of Social Security benefits may be subject to income tax for individuals with a combined income between $25,000 and $34,000, or for couples with a combined income between $32,000 and $44,000; and 
* Up to 85 percent of Social Security benefits may be subject to income tax for individuals with a combined income above $34,000, or for couples with a combined income above $44,000. (Note: “Combined income” means adjusted gross income, plus nontaxable interest, plus one-half of Social Security benefits.)
About a third of current Social Security beneficiaries have incomes that exceed the thresholds, requiring them to pay taxes on a portion of their Social Security benefits. For more information on taxation of Social Security benefits, visit the IRS website at www.irs.gov.
Remember that if you normally don’t file a tax return and the only reason you plan to this year is to receive your stimulus payment, you won’t need a 1099 for that. All you need to do is to fill out an estimate of how much your benefits were during 2007 based on your monthly payment amount on an IRS form 1040 or 1040A.
For more information about social Security, or to request a replacement SSA-1099, visit www.socialsecurity.gov. Or you can call Social Security’s toll-free number, 1-800-772-1213 (TTY1-800-325-0778) and ask for a replacement SSA-1099 over the phone.

QUESTIONS AND ANSWERS

GENERAL

Question:
I got Social Security benefits last year and wasn’t planning to file a tax return. But I heard that I may want to file a tax return to get the “stimulus payment” offered by the government. Should I?

Answer:
Yes. If you received Social Security benefits last year, you may be entitled to an economic stimulus payment, or tax rebate, from the federal government — even if you otherwise wouldn’t plan on filing a tax return. The IRS will begin sending stimulus payments to more than 130 million taxpayers in May. If you have filed or plan to file a 2007 tax return, no other action is necessary. If you receive Social Security and did not file a 2006 tax return, the IRS will send you a package over the next couple of months, which includes everything you need to file a 2007 return and receive a stimulus payment. In this situation, if you no longer have your form 1099, you do not need a replacement form. Instead, simply estimate your total annual benefit on your 2007 tax return. For more information go to the IRS website at www.irs.gov.

Question: 
What should I do if my Social Security card is lost or stolen?
Answer: 
The best solution to prevent that from happening is to keep your Social Security card in a safe place. Never carry it with you unless you know it will be required, such as at a job interview. If you want to safeguard your Social Security card and number, you can take these steps:
* Visit the Federal Trade Commission’s identity theft page at www.ftc.gov/bcp/edu/microsites/idtheft; 
* Educate yourself about identity theft; 
* Monitor your credit reports; and 
* Read Identity Theft And Your Social Security Number at www.socialsecurity.gov/pubs/10064.html. 

For more information, visit our website at www.socialsecurity.gov or call us toll-free at 1-800-772-1213 (TTY 1-800-325-0778). 

RETIREMENT

Question: 
How does Social Security calculate how much I get every month? 
Answer: 
In short, we use your average lifetime earnings, not just several years of earnings, to determine your benefit amount. The benefit formula is complex and there are no simple tables we can present that will tell you exactly how much you will receive. However, we can give you a fairly accurate idea — and we do, each year. Your Social Security Statement is automatically mailed to you about three months before your birthday. If you can’t find your last one and you need one now for planning purposes, you can request it online at www.socialsecurity.gov/mystatement. Your Statement provides a detailed report of your lifetime earnings and an estimate of retirement, disability and dependent benefits. For more information, visit our website at www.socialsecurity.gov or call us toll-free at 1-800-772-1213 (TTY 1-800-325-0778). 

Question: 
I’m 62 and divorced. But my earnings weren’t enough for me to qualify for Social Security. Can I get benefits as a divorced spouse?

Answer: 
In most cases, you can receive benefits as a divorced spouse on your former spouse’s Social Security record if you were married to the former spouse for at least 10 years, are at least age 62 years old, are currently unmarried, and are not entitled to a higher Social Security benefit on your own record. If you would like to get an estimate of benefits you may receive as a divorced spouse, call us toll-free at 1-800-772-1213 (TTY 1-800-325-0778). For more information, visit our website at www.socialsecurity.gov or call us toll-free at 1-800-772-1213 (TTY 1-800-325-0778). 

DISABILITY

Question: 
My 20-year-old daughter has a severe congenital disability. I worry about what could happen once my wife and I have passed away. Can she get disability benefits without having ever worked?

Answer: 
If a parent dies, gets disability benefits or starts receiving retirement benefits, an adult child disabled before age 22 may be eligible for benefits on the parent's account. Though we make the disability decision using the disability rules for adults, we consider this to be a “child’s” benefit because it is paid on a parent’s Social Security earnings record. Another safety net for this type of situation is the Supplemental Security Income (SSI) program. SSI provides monthly payments to people who have little or no income and who don’t own many things, and who are blind, disabled or 65 years or older. For more information, visit our website at www.socialsecurity.gov or call us toll-free at 1-800-772-1213 (TTY 1-800-325-0778). 

Question: 
How does Social Security decide if I am disabled?

Answer: 
For Social Security to consider you disabled, you must be unable to do work you did before and we must decide that you cannot adjust to other work because of a disabling condition. Also, your disability must last or be expected to last for at least one year or to result in death. Social Security pays only for total disability. No benefits are payable for partial disability or short-term disability. For more information, we recommend you read our online publication, Disability Benefits, at www.socialsecurity.gov/pubs/10029.html. You can apply for disability online at www.socialsecurity.gov or call us toll-free at 1-800-772-1213 (TTY 1-800-325-0778).


SUPPLEMENTAL SECURITY INCOME

Question: 
Why does the Supplemental Security Income (SSI) application ask about my “living arrangements?”

Answer:
Your living arrangement can affect your SSI payment amount. For example, a beneficiary's SSI payment may be reduced by up to one-third if the recipient receives food or shelter that is paid for by another person. Where you live, who else is in the household and what you and others pay towards the household expenses can all make a difference in your SSI payment. Learn more about living arrangements by reading our online booklet, Understanding SSI at www.socialsecurity.gov/ssi/text-understanding-ssi.htm. For more information, visit our website at www.socialsecurity.gov or call us toll-free at 1-800-772-1213 (TTY 1-800-325-0778). 

Question:
Is it true that a person can own a home and still be eligible for Supplemental Security Income (SSI) benefits?

Answer:
Yes, a person who owns a home and lives in that home can be eligible for SSI benefits. 
Social Security does not count everything you own in deciding whether you have too many resources to qualify for SSI. For example, we usually do not count the home you live in and the land it is on, life insurance policies with a face value of $1,500 or less, your car, burial plots for you and members of your immediate family, and up to $1,500 in burial funds for you and up to $1,500 in burial funds for your spouse. You may want to read our booklet, Supplemental Security Income at www.socialsecurity.gov/pubs/11000.html. For more information, visit our website at www.socialsecurity.gov or call us toll-free at 1-800-772-1213 (TTY 1-800-325-0778). 

MEDICARE

Question:
I’m about to apply for Medicare but won’t be collecting Social Security for a few more years. My income is limited. Can I get help paying my Medicare Part B premium?

Answer:
Yes. If your income and resources are limited, your state may be able to help with your Medicare Part B premium, deductibles and coinsurance amounts.  State rules vary on the income and resources that apply. Contact your state or local medical assistance, social services or welfare office, or call the Medicare hotline, 1-800-MEDICARE (1-800-633-4227) and ask about the Medicare Savings Programs. To learn more about the Medicare program, read our electronic publication at www.socialsecurity.gov/pubs/10043.html or call us toll-free at 1-800-772-1213 (TTY 1-800-325-0778). 

Question:
I have limited income and think I may be eligible for the extra help with prescription drug costs. I have already signed up for a prescription drug plan and my plan is billing me for a premium. What should I do?

Answer:
If you are a Medicare beneficiary, you are eligible for Medicare prescription drug coverage, regardless of your income, health status or current prescription expenses. Those with limited income and resources may qualify for extra help that can pay your premium. You can see if you qualify for extra help and apply at www.socialsecurity.gov/prescriptionhelp or call us toll-free at 1-800-772-1213 (TTY 1-800-325-0778) Visit www.Medicare.gov or call 1-800-MEDICARE (1-800-633-4227) for more information about the Medicare prescription drug plans. 





15