When California couples divorce, they may not consider how to handle claims with the Social Security Administration. Sometimes, spouses may choose to claim Social Security before full retirement age either by claiming against their own earnings history or that of the other spouse.
As long as the spouses were legally married for 10 years before the divorce, one can claim spousal benefits under the other’s work record. However, if a spouse is earning over a certain amount and is under normal retirement age, the amount of benefits that he or she is able to receive are lowered based on the earnings test. Normal retirement age is the age at which retirement benefits are the same as the primary insurance amount. This test requires Social Security to withhold benefits when a person’s earnings exceed the exempt amount allowed by law. For individuals who have not reached the normal retirement age after 2015, this exempt amount is $15,720. For those who attain normal retirement age in 2015, the exempt amount is $41,8880. This translates to the Social Security Administration withholding $1 in benefits for every $2 in earnings that a person makes over the lower exempt amount.
Even if a person has gone through a divorce and is claiming against a spouse’s earnings record, the benefits that are withheld while working are not lost. The individual’s monthly benefit will increase permanently once he or she reaches full retirement age. This allows spouses to apply for benefits at a younger age based off of the spouse’s earnings record. Then, individuals can claim benefits off their own work record at age 70 when they have earned the maximum amount of delayed retirement credits.
Individuals who are getting divorced may choose to discuss retirement options with a family law attorney. A lawyer could present information on their rights to retirement benefits, including Social Security.