can I pay social security tax voluntarily?


M

My interest

If I lost my job for the whole year, but still want to pay
some social security tax in order to qualify social security
benefit when I retire. Is it possible?

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K

kastnna

My interest said:
If I lost my job for the whole year, but still want to pay
some social security tax in order to qualify social security
benefit when I retire. Is it possible?
Regardless of whether you are allowed to, its almost
certainly not the most financial smart thing to do. You
would be better off investing on your own the amount you
wish to pay in taxes. The return on investment of social
security is low and who knows what the gov't will do to
change its structure in the future.

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
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H

Harlan Lunsford

My said:
If I lost my job for the whole year, but still want to pay
some social security tax in order to qualify social security
benefit when I retire. Is it possible?
Not possible. And here is why.

Future benefits are not based on taxes paid into the system,
but rather on actual earnings per year.

ChEAr$,
Harlan Lunsford, EA n LA

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
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H

Herb Smith

My interest said:
If I lost my job for the whole year, but still want to pay
some social security tax in order to qualify social security
benefit when I retire. Is it possible?
I don't think so. SS taxes, by definition, are assessed as a
percentage of your earnings, so with no earnings there is no
tax due. Each "quarter" for qualification requires a minimum
of about $1000 in earnings, or about $4,000 for the year.
You can Qualify for a maximum of 4 quarters each year, even
if the earnings are only earned in one calendar quarter.

Get a part time job.

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
 
A

Arthur Kamlet

My interest said:
If I lost my job for the whole year, but still want to pay
some social security tax in order to qualify social security
benefit when I retire. Is it possible?
No, social security contributions are not voluntary. If you
have income subject to FICA then you pay, else not.

Some public employers who offer a pension meeting certain
rules can offer that pension plan in lieu of social security
and opt out of social security. There are also rules for
SECA tax for ministers.

If you have self employed income, certain farm income, tip
income or income earned as an employee by the employer has
failed to withhold FICA, you can pay FICA or self employment
tax. But if you ae not receiving income subject to FICA or
self employment then you cannot voluntarily pay into the
system.

--
ArtKamlet at a o l dot c o m Columbus OH K2PZH

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
 
N

NadCixelsyd

My interest said:
If I lost my job for the whole year, but still want to pay
some social security tax in order to qualify social security
benefit when I retire. Is it possible?
I know this is kind of far-fetched, but ...

What if your spouse hires you to clean the yard. You fill
out a schedule C and pay the social security tax. The down
side is that you have to pay income taxes on the earnings as
well, but if your income is low enough, that won't matter.
Aren't SS benefits based on quarters worked? Should you
file quarterly estimated tax payments so that the Social
Security Administration thinks that you worked all quarters
of a year?

Now this is really getting far-fetched ... What if you have
children and low income. Can you claim the earned-income
credit?

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
 
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H

Harlan Lunsford

I know this is kind of far-fetched, but ...

What if your spouse hires you to clean the yard. You fill
out a schedule C and pay the social security tax. The down
side is that you have to pay income taxes on the earnings as
well, but if your income is low enough, that won't matter.
Aren't SS benefits based on quarters worked? Should you
file quarterly estimated tax payments so that the Social
Security Administration thinks that you worked all quarters
of a year?
Well now, Dan, quarterly estimated payments are to the IRS
only, and SSA doesn't know or care what you pay in during
the year. When the schedule se if filed year's end that
total alone governs who many quarters one worked.

A related discussion we've had before involves paying kids
and then taking that money kids "earned" and putting into a
ROTH account. Nothing wrong with that. But one spouse
employing another to do yard work? Sounds similar, doesn't
it? But still smells fishy you will admit I'm sure.

No, the money one spouse might "spend" paying the other plus
associated se and maybe federal and state income taxes is
better spent investing in quality mutual funds.
Now this is really getting far-fetched ... What if you have
children and low income. Can you claim the earned-income
credit?
I don't know, but there's GOT to be something SOMEwhere
which would preclude this.

ChEAr$,
Harlan Lunsford, EA n LA

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
 
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H

Harlan Lunsford

I know this is kind of far-fetched, but ...

What if your spouse hires you to clean the yard. You fill
out a schedule C and pay the social security tax. The down
side is that you have to pay income taxes on the earnings as
well, but if your income is low enough, that won't matter.
Aren't SS benefits based on quarters worked? Should you
file quarterly estimated tax payments so that the Social
Security Administration thinks that you worked all quarters
of a year?

Now this is really getting far-fetched ... What if you have
children and low income. Can you claim the earned-income
credit?
Furthermore, while you're at it, you might consider such
earnings available for contribution to a ROTH IRA. (grin

ChEAr$,
Harlan Lunsford, EA n LA

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
 

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