Adjustments at FRA for Benefits Withheld Due to the Annual Earnings Test

The heart of the question relates to the adjustment at FRA relating to benefits withheld due to the Annual Earnings Test.  Does that adjustment occur with only retirement benefits, or will that adjustment apply also to survivor or spousal benefits as well?

The adjustment for benefits withheld due to the Annual Earnings Test does occur at Full Retirement Age (FRA) for retirement and spousal benefits. For these types of benefits, any months where benefits were not paid due to exceeding the earnings limit are credited, potentially increasing the monthly benefit amount once FRA is reached.

However, for survivor benefits, the adjustments are made at two points: age 62 and FRA. This means that if a widow(er)'s benefits were reduced due to the Annual Earnings Test, the reduction factors are adjusted at these key ages, potentially increasing the survivor benefit amount. The process ensures that the reductions are recalculated to account for the periods when benefits were withheld due to earnings.

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