Social Security earnings limit by year.

How the retirement earnings test works

The retirement earnings test applies only to people below their normal retirement age (the age SSA also calls full retirement age). If you collect retirement benefits early and keep working, Social Security withholds benefits when your earnings are above a yearly exempt amount. Two exempt amounts exist: a lower one for the years before the year you reach full retirement age, and a higher one for the year you reach it. SSA says both generally rise each year with the national average wage index.

Withheld benefits are not simply lost. SSA states that once you reach full retirement age your monthly benefit is increased permanently to account for the months in which benefits were withheld. From the month you reach full retirement age, earnings no longer count toward the test at all.

Exempt amounts by year, 2000 to 2027

The lower amount applies in years before the year you reach full retirement age and costs $1 in benefits for every $2 over it. The higher amount applies in the year you reach full retirement age, only to earnings in the months before the month you reach it, and costs $1 for every $3 over it. SSA's 2027 fact sheet also gives monthly equivalents for 2026 and 2027, shown in the last column.

Exempt amounts before 2000

The test used to follow different rules. It originally applied to all beneficiaries regardless of age, and laws in 1977, 1981, 1996 and 2000 changed the age limits and exempt amounts. From 1983 to 1999 the higher exempt amount applied at ages 65 through 69, and in 1975 to 1982 at ages 65 through 71. Legislation in 2000 eliminated the test after full retirement age and, retroactive to January 1, 2000, applied the higher amount in the year of reaching it.

How the exempt amounts have moved

The lower amount has grown from $10,080 in 2000 to $25,560 in 2027, about 2.5 times, but not smoothly. It was frozen at $14,160 for 2009, 2010 and 2011 and again at $15,720 for 2015 and 2016, and it rose the most in 2017 ($15,720 to $16,920) and 2023 ($19,560 to $21,240). The higher amount behaves differently in those years: SSA lists a 1996 law that raised the amount for beneficiaries aged 65 to 69 for 1996 through 2002, and the table shows it going from $17,000 in 2000 to $25,000 in 2001 and $30,000 in 2002. It is $62,160, $65,160 and $67,920 in 2025, 2026 and 2027.

Those jumps matter if you are looking at an old tax year. The right exempt amount is always the one for the year the earnings were made, and the right column depends on whether that was a year before, or the year of, reaching full retirement age.

Worked example with real numbers

This is a hypothetical person who collects benefits at 63 and earns $40,000 in 2027. The lower exempt amount is $25,560, so $14,440 is over it. At $1 withheld for every $2 over, SSA would withhold $7,220 of that year's benefits. If the person's yearly benefits are only $6,000, the withholding cannot exceed what is payable, so the estimator above caps it at $6,000.

Now take someone who reaches full retirement age in October 2027 and earns $79,920 from January through September. The higher amount is $67,920, so $12,000 is over it. At $1 for every $3 over, the estimated withholding is $4,000. Earnings from the month of reaching full retirement age onward do not count.

Common mistakes and edge cases

• Applying the test after full retirement age. SSA says earnings in or after the month you reach it do not count.
• Using the lower amount in the year you reach full retirement age. That year the higher amount applies to earlier months only.
• Assuming withheld money is gone. SSA increases your benefit later to account for the withheld months.
• Assuming every kind of income counts. The test is about earnings; confirm with SSA which income types count in your case.
• Mixing it up with the tax on benefits. The earnings test withholds benefits, while income tax on benefits is a separate question.

Who this is for and what it does not cover

This page is for people weighing early retirement benefits against continuing to work, and for advisers who need the exempt amount for a specific year. It estimates the annual withholding from one earnings figure. It does not model the first-year monthly rule in detail, spousal or survivor effects, the later benefit increase, or your own full retirement age. Use the full retirement age calculator to find where the test stops.