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1. NOT ALL INCOME COUNTS Only earnings from work count toward the limit. “They don't count things like pensions, annuities, investment income or any bank interest,” Rosa says. Ditto

rental income, inheritances, distributions from retirement accounts or other forms of “unearned” income. The SSA does count some forms of work-related income that aren’t from a salary or

hourly wage, including bonuses, commissions, consulting fees, severance pay, and unused vacation or sick days. Unemployment benefits do not count. And household income isn’t a factor: Social

Security does not count your spouse’s earnings, or those of any live-in children, toward your earnings limit — only your own work income. 2. THE TEST DOESN’T JUST APPLY TO RETIREMENT

BENEFITS You’re subject to the earnings test if you collect Social Security spousal or survivor benefits before reaching full retirement age. The income threshold is the same, as is the

amount of withholding if you exceed it. There are separate earnings rules for people receiving Social Security Disability Insurance (SSDI). To qualify for SSDI, you must be unable to engage

in what the SSA terms “substantial gainful activity.” In 2025, that means work that pays more than $1,620 a month for most people with disabilities or $2,700 for those who are blind. If you

earn more, you could lose your disability benefits. 3. YOU SHOULD REPORT EARNINGS AHEAD OF TIME If you’re subject to the earnings test, tell the SSA what you expect to earn in the coming

year by calling the national help line (800-772-1213) or contacting your local Social Security office. Based on that estimate, the agency will calculate the effect of the earnings test and

suspend your monthly payments until you cover what you “owe.” Take our hypothetical beneficiary who’s due to lose $8,300 to the earnings test in 2025. Let’s say her regular Social Security

benefit is $1,500 a month. That works out to about 5½ months’ worth of benefits, which the SSA would round up — she would not get payments for six months, thus paying off $9,000. She’ll get

her normal monthly payment the rest of the year, and the SSA will subsequently repay the $700 in extra withholding. The following year, when the SSA gets documentation of your actual income

via W-2s and other tax records, they’ll adjust the withholding accordingly, depending on how that figure compares with your prior income estimate. “Once they know what the actual earnings

are, they'll decide, ‘Did we withhold enough? Did we withhold too much?’ ” Blair says. “I tell clients it’s better to overestimate what they’ll earn rather than underestimate. If you

overestimate, you get a check back from SSA with the amount they should have paid you. But if you underestimate, you’ll have to pay them.” 4. THE RULES CHANGE AS YOU NEAR FULL RETIREMENT AGE

In the calendar year in which you will reach FRA, the retirement earnings test gets less onerous. During this period, you’ll lose $1 in Social Security benefits for every $3 in work

earnings above a higher cap — in 2025, it’s $62,160. When you hit full retirement age, the limit goes away altogether. From that month, you can earn any amount from work and it won’t reduce

your monthly payment. In fact, your payment will go up, because … 5. SOCIAL SECURITY PAYS YOU BACK Over time, Social Security repays the money withheld under the earnings limit, starting

when you reach FRA. You won’t get it back in a lump sum. Instead, they will add money back to your monthly benefit, allowing you to recoup most, if not all, of the money withheld.