File and Suspend Definition

A strategy that allows married taxpayers who retire at different ages to maximize Social Security benefits. Under this strategy, when the higher-earning spouse reaches full retirement age, that spouse files for benefits but immediately suspends them. This allows the lower-earning spouse to collect benefits based on the higher-earner's record without reducing the higher-earner eventual benefits. For example, Joe wants to work until he is 70 to maximize his Social Security payments. As the higher earning spouse, he "files and suspends" at age 66. This allows his 62-year-old wife, Jane, to file for increased benefits based on Joe's record. When Joe turns 70, he'll begin to collect benefits at a greater rate than if he had begun collecting at age 66. Using this strategy, Jane's spousal and survivor benefits will also be greater.

This strategy was possible only for benefits suspended by April 29, 2016.