What’s social security quarters?

When you apply for Social Security benefits, the Social Security Administration (SSA) uses work credits to determine if you are eligible for benefits. The work credits apply for all types of benefits, including retirement benefits, disability benefits, and survivor benefits. Work credits are sometimes known as Social Security quarters.

Social security quarters are the units you earn when you work and pay Social Security taxes. You can earn up to four quarters per year if you earn the minimum qualifying amount in a given year. For 2022, you can earn one quarter for every $1,510 in earnings, or the maximum four quarters if you earned at least $6,040 in a year.

What do quarters of coverage mean?

When determining an individual’s eligibility for Social Security benefits, SSA considers the number of employment quarters the person worked. In this case, a quarter of coverage represents a calendar quarter in which a person worked in a covered job and paid Social Security taxes. One quarter of coverage earned represents one work credit; one year has four quarters, meaning a worker can earn up to 4 credits in a year.

Typically, you need 40 quarters to be eligible for Social Security retirement benefits. Since you can only earn a maximum of four work credits in a year, it means you need a minimum of 10 years of work to accrue enough quarters to qualify for Social Security. For 2022, you get one quarter for every $1,510 in wages or self-employment income. If you earn at least $6,040 for the full year, you will get a maximum of four quarters in a year.

Although a quarter of coverage represents the three-month calendar quarter, it does not mean that you must earn the minimum amount required to earn credit in each quarter. The SSA considers the amount you earned in a year and divides the amount by the minimum amount required to earn one credit in a quarter. Therefore, if you earn $6,040 in the first quarter of 2022, and none in the rest of the quarters, you will still receive the four quarters of work in a year.

How are Social Security quarters earned?

Social Security benefits are based on your earnings history during your working years. The SSA maintains a record of earnings of all covered employees and pays benefits based on the amount earned, as long as the covered employees accumulated sufficient credits to qualify for Social Security benefits. Credits are determined based on earned income including salaried income and self-employment income.

If you earned more than 40 credits during your working years, it does not mean you will receive increased benefits. SSA considers the average of your earnings over your working years to determine how much your monthly benefits will be. If you are applying for Social Security retirement benefits, SSA calculates your benefits based on your highest 35 years of earnings. If you worked for less than 35 years, SSA uses zeroes for the years with no income.

How many credits do you need for Social Security?

Social Security requires a different number of credits for the various benefits. Specifically, you will need more credits to qualify for retirement benefits than you will need to qualify for disability benefits.

Here are the number of credits you need for each benefit:

Retirement benefits

To be eligible for Social Security retirement benefits, you need at least 40 quarters of coverage. If you earn the minimum amount needed to earn four credits in a year, it means you must work at least 10 years to qualify for Social Security retirement benefits.

If your annual income is not sufficient to earn the maximum four credits in a year, you will need to work for more than 10 years to accumulate enough credits for retirement benefits. Additionally, if you have less than 40 credits when you retire, and you have reached the minimum age for Social Security, you can delay taking benefits and keep working for a longer time to reach the 40 credits. However, if your spouse is already receiving Social Security benefits, you can claim benefits based on their work history.

Disability benefits

You can qualify for disability benefits under Social Security if you have a disability that has lasted at least one year, and that prevents you from gainful employment. The number of credits you will need to qualify for Social Security disability benefits depends on your age when the disability occurred.

If you were 24 or younger when the disability occurred, you may qualify for disability benefits if you earned 6 credits in the prior 3-years period ending when the disability occurred. If you are between the age of 24 to 31, you may qualify for disability benefits if you earned credit for working half the time between your 21^st birthday and the time the disability began. For example, if you became disabled at 25, you need 2 years of work out of the past 4 years i.e. 8 credits (2 x 4 credits). If you are above age 31, you need at least 20 credits from the 10 years before the time the disability occurred.

Survivor benefits

Qualifying family members may be eligible to receive survivor benefits under Social Security after the death of an eligible worker. The deceased worker must have earned enough Social Security credits to allow the surviving spouse and minor children to qualify for these benefits. Typically, surviving spouses can receive survivor benefits from age 60 or earlier if they are caring for minor children.

If the deceased worker had accumulated 40 work credits at the time of death, the surviving spouse and minor children can claim benefits, regardless of the age when the person died. If the deceased worker had less than 40 work credits at the time of death, the survivors may still be eligible to claim benefits under a special rule. If you had earned at least 6 credits in the three years before the date of death, the spouse and minor children may still get survivor benefits.

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