Spousal benefits for social security are very confusing. One main reason for the confusion is different social security ruling for a spouse and ex-spouse. The other is the outcome when the benefit is claimed before versus after the full retirement age (FRA).
1. Spouses Versus Ex-Spouses Spousal Benefits
Be sure that spouses have filed for their own benefits to qualify for a spousal benefit. This rule is not applicable to ex-spouses.
If a spousal benefit is to be claimed based on the record of earnings of an ex-spouse, the ex-spouse must be 62 and must be qualified for benefits, but in this case, filing for benefits is not a requirement.
If a spousal benefit is to be claimed based on the record of earnings of the current spouse, you must have been married for not less than 9 months and your current spouse must have already filed for their own benefits. Also, the death must be proven to be accidental or happening in line of duty.
The “file and suspend” strategy of married couples where after filing for benefits the spouse immediately suspends its benefits to allow the other spouse to file for a benefit, is no longer available. This means that anyone who suspends their benefits after April 30, 2019, will have to suspend based on their record all of its benefits.
To summarize: If you are still married, for you to qualify for a spousal benefit, your spouse must file for their own benefit. If you have been divorced for 2 years with your 62-year-old ex-spouse for 10years that is eligible for his/her own benefits and you did not remarry, it is not necessary for your spouse to file for you to be qualified for a spousal benefit.
2. Deemed Filing Rules
You are considered to filing for your own benefit and to a spousal benefit when you are filing for your Social Security retirement benefits and the higher of the two will be given to you.
For those who are born on or before January 1, 1954, and are in full retirement age (FRA), a restricted application can be specified in the application and you will be asked to choose to claim your benefit wither for your own or a spousal benefit.
60 and older widows and widowers can use a restricted application. A restricted application can also be used by non-widow or non-widower but only in the following circumstances
• if they are at full retirement age (FRA) or older
• if they are born on or before January 1, 1954 (this was taken into effect only on November 2, 2015)
Before reaching your full retirement age, you are not all allowed to use a restricted application to designate that you intend to file only for a spousal benefit.
You can only use a restricted application to spousal benefits only once you reach your full retirement age or if you were born on or before January 1, 1954. Later on, you can then switch to your own benefit amount.
If your birthdate is on or after January 2, 1954, when you file for benefits you will be assumed that you are filing for all benefits you are qualified for. You will receive a bigger amount of benefit if your spouse has already filed for it.
When you have filed for a benefit and your spouse has not, when the time comes that she files, the filing rules will apply. When the time comes that you qualify for a spousal benefit and you are getting a lesser amount than what you are expected to get, you will be automatically paid by the Social Security with the extra amount of each month.
Assume that the younger spouse files for a benefit at the age of 62. The spousal benefit will not be available if the older spouse has not yet filed for a benefit therefore the younger spouse will have to file for his/her own benefit. If the older spouse files for benefits, the younger spouse will then be qualified for a spousal benefit. If the younger spouse filed a spousal benefit before he/she reaches the full retirement age, calculating for the spousal benefit amount is a little different. It is both called a “supplemental” and “excess” spousal benefit
3. Excess Spousal or Supplemental Spousal Benefits
A spousal benefit is typically 50 percent of the amount of the full retirement age benefit of the spouse. When one spouse is already getting their own benefits, the other spouse will now be qualified for a spousal benefit. A formula is used to compute for the spousal benefit amount that they may receive.
Using the example above, let us assume that the younger spouse claimed at the age of 62. The PIA or the primary insurance amount of the younger spouse is 800 dollars, but since she filed early she is receiving a monthly benefit of 600 dollars. $800/.75 is the reduction she gets for filing before her full retirement age. Then the older spouse file when he turns 66, his PIA is 2100 dollars.
The formula would be the older spouse’s PIA divided by 2 less the younger spouse’s PIA or simply $2,100/2 = $1,050 - $800 = $250.
When the husband claim for benefits and the wife will be qualified for a spousal benefit, the 250 dollars will be added to her current monthly benefit making it from 600 dollars to 850 dollars.
If the wife delayed her filing for benefits until her own full retirement age, she will be receiving a full spousal benefit of 1050 dollars and this is higher compared to her own full retirement benefit of 800 dollars. Of course, to be able to get the higher benefit, the first four years will be a sacrifice that is why filing early is more sensible.
David Macgregor