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Deemed Filing

Many times the question comes up – Since my spouse has filed for Social Security retirement benefits, can I file for only the Spousal Benefit?

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This is a complicated question with two answers, depending on your date of birth. This is because there are two different rules: one that applies if you were born before 1954 and one if you were born in 1954 or after. These rules came into effect in 2016, after passage of the Bipartisan Budget Act of 2015.

It is certainly possible for the individual born before 1954 who is at or over Full Retirement Age (FRA). This is a common circumstance that many folks employ, although the number of people who can employ this is diminishing. One spouse files for benefits and the other, hoping to achieve the full Delayed Retirement Credits (DRCs) while still receiving a benefit, files for the Spousal Benefit only. This is a perfectly allowable method, but only for folks born on or before January 1, 1954.

If you’re under FRA (no matter when you were born), the option for filing solely for a spousal benefit is not available. This is because, prior to FRA, if you file for the Spousal Benefit, you are deemed to have filed for your own benefit as well. This is known as “deemed filing”, and it applies in all circumstances when you’re under FRA. The result of this action is that your own benefit will be permanently reduced, as will the Spousal Benefit that you’re filing for early as well. The reverse is true as well: if you file for your own benefit before FRA and you’re also eligible for a spousal benefit, you are deemed to have filed for both benefits at the same time. If you are not eligible for the spousal benefit at the time of your filing for your own benefit, as soon as you become eligible for the spousal benefit, deemed filing requires that you have automatically filed for the spousal benefit.

The group of people born before 1954 will all be at or older than FRA by January 1, 2020, so this group’s decision process is coming to an end. Let’s look at how deemed filing works for folks born in 1954 or later.

For anyone born on or after January 2, 1954, deemed filing has a very absolute application. In any case where you’re eligible for both a spousal benefit and your own retirement benefit, deemed filing will require that any application for benefits is an application for both benefits. No matter whether you’re over, under, or exactly at FRA, you can no longer separate these benefits.

If you are not eligible for a spousal benefit when you first file for your own retirement benefit, of course you’ll only be filing for the benefit that you’re currently eligible for. But as soon as you become eligible for a spousal benefit (because your spouse filed for his or her own benefit), you are deemed to have filed for the spousal benefit in the first month of your eligibility.

Deemed filing only applies to your own benefit and the spousal benefit. If you are eligible, for example, for both your own benefit and a survivor benefit, you can separate these two benefits in your filing, regardless of your age and date of birth. You could file for your own benefit at one age (perhaps before FRA) and delay the survivor benefit until you reach FRA (when it is maximized). The reverse is also true: If you’re eligible for a survivor benefit, you could file for the survivor benefit only and delay filing for your own benefit until as late as age 70, when your retirement benefit is maximized. The earlier filing for either benefit has no impact on the later filing for the other.

9 Comments

  1. […] new rules essentially expand the deemed filing rules to people that are already full retirement age.  This would put an end to file and suspend and […]

  2. I am still not clear on deemed filing. My husband is 69. He is still working, but has already filed at FRA.
    I am 59. Due to serious heart health issues, I plan to retire at 62. Do I file for MY (reduced) benefit at age 62, or a (reduced) Spousal Benefit from my husbands Social Security income?
    His salary is greater than mine. I think “Deemed Filing” is because I am under FRA, right? Do I collect one check, from MY Social Security benefits until I am FRA, and then collect a (reduced) Spousal Benefit? Or both?
    Each couple’s situation is different. I want to do what will be best for us, but I’m not clear on exactly which course of action is the right for our set of circumstances.

    1. jblankenship says:

      Janet –

      Deemed filing requires that, if you are under Full Retirement Age and you’re filing for EITHER your own benefit or the Spousal Benefit and you’re eligible for both, then you are deemed to be filing for both benefits.

      In the situation you describe, since your husband has filed for his benefit, once you reach age 62 you are eligible for the Spousal Benefit. If you file before age 66 you have no alternative but to file for both your own benefit and the Spousal Benefit, and both will be reduced since you’re filing prior to FRA.

      Hope this helps –

      jb

  3. Mark Mathes says:

    At FRA for each, can both spouses file and suspend and each apply for the spousal benefit? The FRAs are 14 months apart with the much lower spouses PIA being the earlier FRA.

    1. jblankenship says:

      No, only one spouse can receive the spousal benefit at a time.

      jb

  4. […] currently eligible for the Spousal Benefit in the month that she files for her own benefit, due to deemed filing); she cannot file for Spousal Benefits early (before FRA) and delay her own […]

  5. Stephen says:

    My wife and I are 64 years of age.

    I have been reading some of your explanations concerning spousal benefits and wonder if you could confirm or clarify something.

    My wife began drawing SS benefits when she was 62, but because she has not worked outside the home very much the amount is small; namely about $200 per month.

    However, I do not plan on drawing any SS benefits until my full retirement age of 66. Since I was and am the primary source of income, the SS benefit amount I am scheduled to receive at FRA is considerably higher than hers.

    Question: When I begin drawing full benefits at 66, does her spousal benefit amount to 35% of my full benefit, and is that 35% added to the $200 she already gets?

    Kind regards,
    Stephen

    1. jblankenship says:

      Stephen –
      Since the amount of your wife’s own benefit is small, the reduction for taking early benefits is small as well, in terms of real dollars. Because of that, when she (and you) reach FRA and she files for Spousal benefits, her overall benefit will be relatively close to 50% of your benefit, only reduced by the small amount that her own benefit was reduced.

      Hope that helps –

      jb

  6. […] Social Security Planning Mistake: Deemed Filing from Financial Ducks in a Row […]

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