Social and Behavioral Sciences Commons^™

Social Security's Earnings Test Penalty And The Employment Rates Of Elderly Men Aged 65 To 69, Stephen Rubb

WCBT Faculty Publications

Social Security provides retirement income to eligible elderly individuals who reach age 62 and apply for benefits. Beyond this age, some recipients continue to work on a full- or part-time basis. The Social Security Administration reduces the annual level of benefits for those recipients who have earnings above a specified amount known as the earnings test threshold. Effective in 1990, the earnings test penalty for a person aged 65 to 69 was reduced from 50 cents to 33 cents for every dollar earned in excess of the annually adjusted threshold. The labor supply response to the 1990 reduction in the …