Feb 24, 2025
For many retirees, Social Security is an important source of retirement income — one they hope to maximize. But there are a few factors that could slash the value of your check. Which ones could impact you, and what can you do about them?
The average Social Security benefit for retired workers was $1,978.77 as of January, which works out to just over $23,700 per year. Benefits that your spouse, ex-spouse or children receive based on your benefit amount may not reduce your benefit, but there are several garnishments and levies that could.
Some deductions are automatic or optional
Medicare Part B premiums are automatically deducted from your Security benefit (the standard premium in 2025 is $185 per month). Your check might also be reduced if you’re younger than full retirement age, choose to work while receiving benefits and make more than the prescribed yearly earnings limit.
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Other deductions are optional. For example, you might opt to have your federal income taxes withheld from your benefit to reduce your payment at tax time. Using Form W-4V, you can opt to have 7%, 10%, 12% or 22% of your benefit withheld. Depending on your insurance provider, you could also opt to have Medicare Part C and Part D premiums deducted.
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Some deductions relate to federal debts and court orders
If you have consumer debt, a debt collector can’t garnish your Social Security benefit, but your payments could be dramatically reduced by garnishments and levies resulting from federal debts and court orders. These can result from owing federal back taxes, federal student loans, alimony and child support.
Federal back taxes: If you owe federal back taxes, the Internal Revenue Service (IRS) can garnish up to 15% of your monthly Social Security benefit until the debt is paid off. You may contact the IRS to discuss appeal options, including a request for a levy release based on immediate economic hardship. The IRS may release the levy under certain circumstances — say, for example, if doing so will help you pay your taxes or if you make an installment agreement.
Federal student loans: Around 2.8 million Americans 62 and older still owe student loan balances. If you’ve defaulted on your federal student loans, up to 15% of your benefit can be garnished. However, you must be left with at least $750 per month. To stop the garnishment you need to pay in full or, within 30 days of the notice of intent to garnish, negotiate a payment plan or request a hearing.
Alimony and child support: If you owe alimony and/or child support, the Social Security Administration (SSA) may garnish your benefit if ordered to do so by the court. Based on the garnishment order, the SSA will calculate how much to take off each monthly benefit payment.
The garnishment will be limited to the lesser of the maximum in the state issuing the order or the maximum allowed under the Consumer Credit Protection Act (CCPA). The CCPA limit is 50% of the benefit if you’re supporting a second family or 60% if you’re single. An additional 5% can be added to each of these maximums if the original support is more than 12 weeks in arrears.
If you’re in the unfortunate position of being subject to more than one type of garnishment or levy, your Social Security benefit could be reduced significantly. If you’re falling behind on debt payments, it’s best to be proactive and try to work something out with your creditors before it reaches this point.
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Vawn Himmelsbach is a veteran journalist who has been covering tech, business, finance and travel for the past three decades. Her work has been featured in publications such as The Globe and Mail, Toronto Star, National Post, Metro News, Canadian Geographic, Zoomer, CAA Magazine, Travelweek, Explore Magazine, Flare and Consumer Reports, to name a few.
