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Your Social Security Benefits Questions: Social Security Credits
Q: According to Social Security, I havent obtained enough credits to be eligible for benefits. How do these credits work, and how is it possible for me to not have enough when I have worked for years and paid taxes the whole time?
A: Credits that go towards qualifying you for benefits from Social Security are earned by working and paying your Social Security taxes. The Social Security service bases the number of credits a person receives on the amount of money they earn and the amount of time they have worked. With each year that passes, the amount of money you need to make in order to earn social security credits rises; in 2008, it is one credit for $1,050 of earnings. You can receive a maximum of four credits annually (which is why credits are also called ‘quarters), and any credits you earn will remain on your record even during periods in which youre not working.
A certain number of credits or quarters are required in order to qualify you to receive social security benefits. The number of credits you need for social security is based on your current age, and is calculated by the number of years you have worked. Most people looking to qualify for retirement social security benefits (that is, over the age of 62) will need 40 credits, or 10 years of work, to be eligible for benefits.
It does occur, however, that a person of retirement age who has worked for what seems to be the correct number of years does not have enough credits to qualify him or her for social security benefits. This can happen to workers who didnt (or dont) have social security taxes deducted from their wages. In general, this sort of situation occurs with Federal employees who were hired before 1984, employees of railroads who have more than ten years of service, and the employees of governments (both state and local) which have chosen not to participate in the social security program.
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