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Your Social Security Benefits Questions: Social Security Credits Q: According to Social Security, I havent obtained enough credits to be eligible for benefits. What are Social Security credits, and how can I not have enough of them when Ive worked and paid taxes for years? A: Credits that go towards qualifying you for benefits from Social Security are earned by working and paying your Social Security taxes. The number of credits you receive is based on both income and the number of years worked. With each year that passes, the amount of money you need to make in order to earn social security credits rises; in 2008, it is one credit for $1,050 of earnings. You can receive a maximum of four credits annually (which is why credits are also called ‘quarters’), and any credits you earn will remain on your record even during periods in which youre not working. In order to qualify for social security benefits, you need to reach a certain number of credits. The number of credits you need for social security is based on your current age, and is calculated by the number of years you have worked. If youre looking to be eligible for social security benefits for retirement (and are of more than 62 years of age), you will need to have 40 credits (the equivalent of 10 years of work). It does occur, however, that a person of retirement age who has worked for what seems to be the correct number of years does not have enough credits to qualify him or her for social security benefits. This occurs to workers who, during their working careers, did not (or do not) have social security taxes taken out of their wages. In general, this sort of situation occurs with Federal employees who were hired before 1984, employees of railroads who have more than ten years of service, and the employees of governments (both state and local) which have chosen not to participate in the social security program.
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