This is a tough article to write, but needs to be addressed as it does happen. What do you do if the main breadwinner in the family dies and leaves a widow and child or children behind, and this young person has not accrued the 40 required quarters of earnings to qualify for Social Security benefits? Is there any help available?
Most people think of the Social Security as a program for older people who are eligible to retire and collect their benefits, or for those that are having to file for disability benefits, or those that qualify to receive widow or widower benefits. Most people are not aware that is also provides benefits for very young workers. There is an exception in the law to the 40-credit law in these instances.
When you earn $1300 under the Social Security system, you receive one quarter of credit, with four credits being the maximum allowed each year. So, to earn 40 credits, you must have worked 10 years, part-time, making the required $1300 per quarter. This combination will make you eligible for Social Security benefits. Because widow benefits cannot begin until age 60 (or age 50 if disabled) there is quite a gap for the young widower.
The number of credits needed for a benefit for a younger worker depends on the age of the worker at the time of their death. The younger the person is, the fewer the credits required for widow and family benefits. Survivors are entitled to benefits if the worker, after age 21, worked at least one and one-half years during the three years prior to death. The child is also entitled to a survivor benefit equal to 75% of the deceased parent’s benefit until the child turns 18 (or 19 if still in high school). Together the mother and the child or children could receive 150% – 180% of the deceased persons Social Security benefit, depending on the number of children that are eligible. If the sum of the benefits to family members is greater than the allowed limit, they amount will be reduced proportionately.
A caveat here – if the widow is working, she will be restricted on income by the Earnings Limitations laws (currently $16,920 in 2017). This means for every $2 she earns over the limitation, Social Security will withhold $1 of benefits. However, her earnings will not reduce the children’s survivor benefits.
There is also a one-time lump-sum death benefit of $255 payable to the surviving spouse. If there is not an eligible surviving spouse, this benefit can be paid to the children. This benefit must be applied for within two years of the date of death.
Call Pillars LLC at 601-954-0699 and Roy and Diane will help you with these decisions and show you how to maximize your benefit and accomplish your personal goals. They are both National Social Security Advisors and Roy is a former CPA of 40+ years. We are in Corinth but service all 50 states. www.pillarsllc.com