Changes to Claiming Rules for Social Security Benefits

The Bipartisan Budget Act of 2015 implemented several important changes to the rules for claiming Social Security, with some changes becoming effective immediately and others becoming effective on various future dates.

One special rule in effect since 2000 had permitted a person to claim retirement benefits at full retirement age (currently age 66) but “suspend” that claim, meaning he or she would not actually collect the benefits at that time. The purpose of suspending the benefits was that they would grow by 8% per year until the person reached age 70 (as discussed above). Meanwhile, because the retirement benefits had technically been “claimed,” that person’s qualifying spouse or child could collect dependents benefits during the four years of suspension. As of April 30, 2016, however, this claim-and-suspend rule will be eliminated. Under the new rule, a person must actually begin collecting retirement benefits before a spouse or child can collect dependents benefits (for any claim filed on April 30, 2016 or after). In other words, as long as the person’s retirement benefits are suspended, dependents benefits cannot be paid.

The new rule will not cut off benefits to those who have already taken advantage of the prior suspension rule. So, anyone who has filed a valid a claim for dependents benefits before April 30, 2016 based on a suspended claim for retirement benefits may continue to collect those dependents benefits.

Another rule that is eliminated for anyone who did not turn 62 by the end of 2015 is the ability to choose whether to collect a person's own retirement benefit or instead collect a spousal benefit based on the spouse's earning record (this is called filing a "restricted application." For those who turn 62 in 2016 or later, any filing for one type of Social Security benefit becomes a filing for all Social Security benefits, and the Social Security Administration will choose which benefit to pay out. This means that a spouse can no longer choose to collect a spousal retirement benefit while letting his or her own retirement benefit grow.

Finally, immediately eliminated is the ability to "undo" a suspension of retirement benefits and collect a lump sum of the amount the retiree would have received for retirement benefits up to that date. While a person can still request that a suspension be ended, he or she will be able to collect benefits only starting in the month the request to undo the suspension is filed. Benefits the person might have collected during the suspended months may not be collected retroactively.

For more information, see Social Security, Medicare & Government Pensions, by Joseph Matthews (Nolo).