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Wage earners may be eligible for Social Security benefits if they earn enough Social Security credits. In this article, we’ll define the term “wage earner” as it pertains to Social Security. 

Key Takeaways

  • A wage earner is a person who earns Social Security credits while working for wages or self-employment income
  • Social Security credits can be earned while working and paying Social Security taxes
  • Eligible dependents and survivors of wage earners may also be eligible for Social Security benefits on the basis of the wage earner’s earning history

What Is a Wage Earner?

In the context of Social Security benefits, a wage earner is a person who earns Social Security credits while working for wages or self-employment income. They may also be called a worker or number holder. 

How to Earn Social Security Credits

Social Security credits can be earned by working and paying Social Security taxes. As a wage earner works and pays Social Security taxes, they earn credits that count toward their eligibility for Social Security benefits. It is possible to earn up to four credits a year. 

In order to qualify for benefits, most people must earn a minimum of 40 Social Security credits. As such, most people must work for ten years or more to qualify for benefits. To qualify for disability or survivor benefits, younger people may earn fewer credits. 

Wages vs. Self-Employment Income

Wage earners can earn Social Security credits on the basis of income in the form of wages or self-employment income. Wages are paid to an employee by their employer. Self-employment income is income earned from performing personal services that cannot be classified as wages because there is no employee/employer relationship between the payer and the payee. 

In the case of employees earning wages, Social Security taxes are automatically deducted from each paycheck by their employer. The employer must also match the contribution. Both of these contribute toward the wage earner’s Social Security coverage.

In the case of wage earners earning self-employment income, the worker must pay both the employee's and the employer’s portion of the Social Security tax. This is not deducted from wages but rather must be paid when filing a yearly federal tax return. 

Survivors and Dependents Benefits

Eligible dependents and survivors of wage earners may also be eligible for Social Security benefits on the basis of the wage earner’s earnings history. This includes spouses, ex-spouses, parents, and children. 

Wage earners interested in planning for retirement, ensuring that they are eligible for Social Security benefits, and maximizing their monthly Social Security payments are recommended to consult with a financial planner or other Social Security expert.

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