SERP and SSA Benefits

[CO Bank]

Our company has a Supplemental Executive Retirement Plan (SERP). This is a non-qualifed plan and benefits are paid from general assets. Upon retirement we pay participating executives either a lump sum or stream of payments over x years.

My question: will a SERP payment impact SSA benefits?

I called the SSA and they said no. They were not familiar with SERPs, so I explained it as being a non-qualifed retirement plan. They stated clearly that any retirement benefit is not considered earned income regardless of when paid out, and thus would not reduce SSA benefits.

I spoke with our CPA who said otherwise, the SERP payments would reduce SSA benefits if the payouts were made prior to age 66.

???

[masteff]

This is a non-qualifed plan

I presume you're referring to the annual earnings test which applies to persons who receive SSA prior to attaining their SSA full retirement age.

http://www.ssa.gov/OP_Home/handbook/handbo...dbook-1811.html

http://www.ssa.gov/OP_Home/handbook/handbo...dbook-1812.html

http://ssa.gov/pubs/10063.html

[CO Bank]

This is a non-qualifed plan

I presume you're referring to the annual earnings test which applies to persons who receive SSA prior to attaining their SSA full retirement age.

http://www.ssa.gov/OP_Home/handbook/handbo...dbook-1811.html

http://www.ssa.gov/OP_Home/handbook/handbo...dbook-1812.html

http://ssa.gov/pubs/10063.html

[CO Bank]

Thanks, very helpful

[Guest odessa477]

Reading the SSA handbook is really good to understand things like this.