The first little known fact about work credits for most people will be that work credits exist. Frankly, most people have never heard of work credits. If they have heard of them, they may not think work credits are important. However, the number you have earned can significantly affect your access to certain government benefits.
How They Are Earned
The Social Security Administration (SSA) tracks the number of work credits earned, which is based on an employee’s income. For every $1,360 per a worker earns, they receive one work credit, with some exceptions.
- Self-employed persons earn work credits by paying Social Security tax on their earnings.
- Military personnel have the option of earning more credits than civilians.
- Earning work credits for domestic work, farm work, and church-related employment differs from other types of work.
Survivors of a deceased worker may be able to access the work credits earned by the worker.
How Many You Can Earn
You can earn up to four (4) work credits per year. You can create a personal account at www.ssa.gov to your work history and credits.
How Work Credits Are Used
Your work credits are the basis for your Social Security retirement and disability benefits. To receive your retirement benefits, you will need to have earned 40 work credits.
However, work credits also figure into Social Security Disability Insurance (SSDI). Applicants for SSDI must have enough work credits to be considered for disability benefits. However, a 21-year old and a 62-year old usually are not required to have the same number of work credits.
How the Work Credit Sliding Scale Works
Most applicants born after 1929 need 40 credits for retirement or disability benefits. For SSDI, 20 of those credits must have been earned in the 10 years before the worker became disabled.
Younger workers will not have had time to earn 40 credits, especially since you can only earn four per year. The SSA uses a sliding scale to determine the number of credits needed:
- A worker disabled before age 24 should need only six work credits.
- Workers aged 24 through 30 need credits for only half of the years between age 21 and the time their disability started. For example, a 27-year-old worker only needs three years of work history and 12 work credits.
- Workers age 31 through 42 need to have earned 20 credits.
- After age 42, the sliding scale adds two credits every two years. For example, a worker aged 54 needs an 8-year work history and 32 work credits.
Confused About Work Credits? Give Us a Call!
At the Law Offices of Martin Taller, your case receives the attention and care of experienced Social Security Disability attorneys.
For your free consultation, call us at 714-385-8100. We are located in Anaheim, but we assist clients throughout Southern California.