Lottery Winnings and Social Security Retirement Benefits?
If a person wins a million dollars at age 57 and is scheduled to be paid $50,000 per year for 20 years and then retires in one of those years...at age 62 (year #5 of 20)... and according to that persons Social Security Statement at age 57 had earned enough in "working wages"to be eligible for say $1,200 per month in Social Security Retirement Benefits... and assuming that person continues to work until retirement, how will or will those Social Security Retirement Benefits be affected when that person actually retires at age 62? Bottom line.. does Social Security calculate the Lottery Winnings for each year into the benefit calculation or is it just the "working wages" that are used and the Social Security Retirement benefit stays the same .... at $1,200 per month?
Public Comments
- The social security benefit would not change. The tax bill would as 85% of the benefit would now be taxable income on the 1040. So, if they had only SS, before the lootery win, they'd have no taxable income; afterwards they would have $62K, $50 from the lottery and $12 from the taxable SS portion.
