Understanding Social Security
by: Wyoming Legal Services - Lander Office
The Basics
Chances are that you are either paying Social Security taxes or getting Social Security benefits - or - you are related to someone who is.
How Social Security Works
- When you work, you pay taxes into the Social Security system;
- If you retire, you, your spouse and your dependent children receive monthly benefits based on your earnings;
- If you become disabled, you, your spouse and your dependent children receive monthly benefits based on your earnings;
- Your survivors collect benefits when you die.
Social Security benefits are paid to:
- Retired persons;
- Disabled persons;
- Spouses or dependents of someone who gets social security;
- The spouse or child of someone who has died.
The money to pay social security come mostly from 3 places:
- Social Security benefits are paid for by Social Security taxes;
- Medicare benefits are paid for by Medicare taxes;
- Supplemental Security Income (SSI) benefits are paid for by general tax revenues.
Social Security benefits are not meant to meet all of your financial needs. When you retire, you will probably need other income.
Where your Social Security tax dollars go:
- Social Security taxes - for each dollar paid:
a) $0.85 goes to a trust fund to pay retirees, their families, widows, widowers and the children of workers who have died;
- Medicare taxes go to a trust fund to pay for the costs of hospital and related care for all Medicare beneficiaries.
What You Need to Know About Social Security While You are Still Working
You need a Social Security number:
- to get a job
- to pay taxes
- to collect Social Security benefits
- to get services from many other businesses and government agencies
Your Social Security records are not available to anyone without your written consent unless the law requires or permits it.
You need a Social Security number if you lose your card or if you change your name:
- You can visit the SSA website www.ssa.gov or visit a local Security office to order one.
- You will be asked to fill out a one-page form and to provide certain documents - originals or certified copies
- You will need a birth certificate and some form of ID for a new card
- You will need ID for a replacement card
- You will need a marriage certificate, divorce papers, a court order or a birth certificate for a name change.
You become eligible for Social Security by earning "credits"
- You must work and pay taxes to receive benefits; your dependents or survivors may be eligible for benefits on your record
- As you work and pay taxes, you earn Social Security credits. Most people need 40 credits (10 years of work) to receive benefits
- Younger people need fewer credits to receive disability benefits or for family members to receive survivors benefits if a worker dies.
- Extra credits do not increase your benefits, but your income may increase your benefit.
If you work for someone else, you and your employer pay taxes for Social Security and Medicare.
If you work for yourself, you pay your own Social Security and Medicare taxes.
Your Social Security benefit amount is based on your date of birth, the type of benefit you apply for and your lifetime earnings.
If you are 25 or older and not already receiving benefits on your own record, you will receive a Social Security Statement each year that displays your earnings record and provides benefit estimates.
If you have questions you can call:
Toll Free at 1-800-772-1213
TTY Number at 1-800-325-0778
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For more information see:
www.socialsecurity.gov
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