Do Deductions For Medicare Stop When I Reach Retirement Age?
Most taxpayers expect social security and Medicare deductions to disappear from their paychecks once they reach the age of 65. A long life experience with the federal government should cause them to think differently about it. The deductions do not stop just because someone reaches a certain age.
Employees Pay Medicare Deductions As Long As They Work
The federal government requires employers to collect federal and social security taxes from all employees regardless of their age. The only exceptions are independent contractors who must pay these taxes on their own. A retiree who gets a part-time and re-enters the work force will start paying social security and medicare taxes again.
The retiree may think that a reduction in the rates occurs, but this is also not true. The government engages in what could be termed tipple dipping. A person who finds a job may find that the amount of money he earns overall goes down, although this outcome is exceptionally unlikely.
What Does the Government Do?
A person on social security who works more than 20 hours per week risks having his benefits reduced or losing them entirely. Even if his benefits remain the same, he will still pay social security and medicare deductions from his second paycheck. He can still expect a certain amount of additional income.
The ticket-to-work program may reduce these risks for some people on social security, but the program is mostly designed for younger people who are on disability to get people off of disability and back onto the employment rolls.
A person who reaches retirement ages and wants to do things honestly should not worry too much about social security or Medicare taxes as they are a small part of his tax burden. A part time job lets a person remain active and social after retirement.
Related posts:
- Can Medicare Take My Retirement Savings?
- Are Medicare Benefits Taxable?
- Are Medicare Benefits Taxable?
- What Are Medicare Wages?
- Can I Get Unemployment And Be On Medicare At The Same Time?