Part of the new two year budget deal signed into law this week makes changes to the “File and Suspend” and “Restricted Application” Social Security strategies (or “loopholes”). While this does not affect many of you it is something we have mentioned “in passing” during meetings when discussing Social Security. We do not put these strategies into our planning for clients so there should be little to no impact on your retirement reports. However, it is something to note. Below are two links to detailed explanations of the changes (one short and one long) but I will provide a high level explanation here.
There has long been a strategy (or loophole if you prefer that term) in the Social Security benefit program commonly referred to as “file and suspend”. In short, this could allow a spouse to file for benefits and immediately suspend them. Thus, allowing their benefits to continue to grow while also allowing the other spouse to start spousal benefits. Beginning in April the availability of this will end. We’ll be discussing it more as needed and if you have questions let us know.
Longer (Detailed) Article: Navigating The Effective Date Deadlines For The New File And Suspend And Restricted Application Rules