Most Social Security benefits, including retirement and disability insurance benefits, are based on a worker’s earnings. The amount of benefits depends on longevity and level of earnings a worker has amassed while in employment. Sometimes after a worker learns how much of a benefit they would be eligible for and look into the earnings record Social Security has for them, they believe it is wrong. The good thing is a worker can ask Social Security to correct the record, but the bad news is it is not that easy to do. Below are the steps Social Security requires before an earnings records can be corrected.
Can Your Earnings Record Be Corrected?
Your earnings record can be corrected (subject to the requirements in §§1424-1425 if the time limit has passed) if there is acceptable evidence of wages paid to you.
What Evidence Is Acceptable?
The evidence may be a statement signed by your employer, Form W-2 (Wage and Tax Statement), pay envelopes or pay slips, or personal records of your wages. (See §§1726-1733 for a discussion of how to establish wages.)
How Can Self-Employed People Establish Earnings?
If you are self-employed, you may establish earnings by submitting a copy of your tax return. Include the applicable schedules (see §1416) and evidence that your return was filed on time with IRS. Evidence of filing your return includes canceled checks, IRS receipts, or other evidence of payment of tax shown on your return.
How Can Partnerships Establish Earnings?
If a partnership is involved, a copy of Form 1065 should also be furnished.
Unfortunately workers realize their earnings are incorrect too late sometimes as Social Security puts time restraints on correcting earnings.
What Is The Time Limit For Correcting Earnings?
An earnings record can be corrected at any time up to three years, three months, and 15 days after the year in which the wages were paid or the self-employment income was derived. “Year” means “calendar year” for wages and “taxable year” for self-employment income. If the last day of that period falls on a Saturday, Sunday, legal holiday, or other non-work day for Federal employees set by statute or Executive Order, the period for correction is extended to the end of the next work day.
If special circumstances exist, Social Security will consider extending the period in which a worker can correct their earnings.
After the time limit has passed, earnings records can only be revised under the conditions described below:
- To correct an entry established through fraud;
- To correct a mechanical, clerical, or other obvious error;
- To correct errors in crediting earnings to the wrong person or to the wrong period;
- To transfer items to or from the Railroad Retirement Board (if reported to the wrong agency), or to add railroad earnings to Social Security earnings records when the law permits;
- To add wages paid in a period by an employer who made no report of any wages paid to the worker in that period, or if the employer is increasing the originally reported amount for the period;
- To add or remove wages in accordance with a wage report filed by the employer with IRS; or, if a State or local governmental employer, with SSA if the report is filed within the time limitation specified for assessment, refund, or credit under a State’s coverage agreement;
- To add self-employment income in a taxable year if an individual or the individual’s survivor establishes that:
- A self-employment tax return for that year was filed before the time limit ran out; and
- Either no self-employment income for that year has been recorded in the individual’s earnings record, or the recorded self-employment income for that year is less than the amount reported on the self-employment tax return; or
- To add self-employment income for any taxable year up to the amount of earnings that were wrongly recorded as wages and later deleted. This can be done only if a tax return reporting such self-employment income is filed within three years, three months, and 15 days after the taxable year in which the earnings wrongly recorded as wages were deleted. The self-employment income must:
- Be for the same taxable year as the year in which the wages were removed; and
- Have already been included on the individual’s Social Security record.
- Prior to the expiration of the time limit the worker or the worker’s survivor has:
- Applied for benefits and stated that the earnings for a year(s) were incorrect; or
- Requested a revision of his or her earnings record for a year(s).
