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Notes

20 C.F.R. §§ 404.220–404.222

3 sections in range

§404.220. Average-monthly-wage method.

20 C.F.R. § 404.220

(a)
Who is eligible for this method. You must before 1979, reach age 62, become disabled or die to be eligible for us to compute your primary insurance amount under the average-monthly-wage method. Also, as explained in § 404.230, if you reach age 62 after 1978 but before 1984, you are eligible to have your primary insurance amount computed under a modified average-monthly-wage method if it is to your advantage. Being eligible for either the average-monthly-wage method or the modified average-monthly-wage method does not preclude your eligibility under the old-start method described in §§ 404.240 through 404.242.
(b)
Steps in computing your primary insurance amount under the average-monthly-wage method. We follow these three major steps in computing your primary insurance amount under the average-monthly-wage method:
(1)
First, we find your average monthly wage, as described in § 404.221;
(2)
Second, we look at the benefit table in appendix III; and
(3)
Then we find your primary insurance amount in the benefit table, as described in § 404.222.
(4)
Finally, we apply any automatic cost-of-living or ad hoc increases that became effective in or after the year you reached age 62, or became disabled, or died before age 62, as explained in §§ 404.270 through 404.277.
Notes, amendments, and revision history

Authority

Authority: Secs. 202(a), 205(a), 215, and 702(a)(5) of the Social Security Act (42 U.S.C. 402(a), 405(a), 415, and 902(a)(5)).

Source

Source: 47 FR 30734, July 15, 1982, unless otherwise noted.

§404.221. Computing your average monthly wage.

20 C.F.R. § 404.221

(a)
General. Under the average-monthly-wage method, your social security earnings are averaged over the length of time you can reasonably have been expected to have worked under social security after 1950 (or after you reached age 21, if later).
(b)
Which of your earnings may be used in computing your average monthly wage.
(1)
In computing your average monthly wage, we consider all the wages, compensation, self-employment income, and deemed military wage credits that are creditable to you for social security purposes. (The maximum amounts creditable are explained in §§ 404.1047 and 404.1096 of this part.)
(2)
We use your earnings in your <I>computation base years</I> in computing your average monthly wage. All years after 1950 up to (but not including) the year you become entitled to old-age or disability insurance benefits, or through the year you die if you had not been entitled to old-age or disability benefits, are computation base years for you. Years after the year you die may not be used as computation base years even if you have earnings credited to you in them. However, years beginning with the year you become entitled to benefits may be used for benefits beginning with the following year if using them would give you a higher primary insurance amount. Years wholly within a period of disability are not computation base years unless your primary insurance amount would be higher if they were. In such situations, we count all the years during the period of disability, even if you had no earnings in some of them.
(c)
Number of years to be considered in computing your average monthly wage. To find the number of years to be used in computing your average monthly wage—
(1)
We count the years beginning with 1951 or (if later) the year you reached age 22 and ending with the year before you reached age 62, or became disabled, or died before age 62. Any part of a year—or years—in which you were disabled, as defined in § 404.1505, is not counted unless doing so would give you a higher average monthly wage. In that case, we count all the years during the period of disability, even if you had no earnings in some of those years. These are your elapsed years. (If you are a male and you reached age 62 before 1975, see paragraph (c)(2) of this section for the rules on finding your elapsed years.)
(2)
If you are a male and you reached age 62 in—
(i)
1972 or earlier, we count the years beginning with 1951 and ending with the year before you reached age 65, or became disabled or died before age 65 to find your elapsed years;
(ii)
1973, we count the years beginning with 1951 and ending with the year before you reached age 64, or became disabled or died before age 64 to find your elapsed years; or
(iii)
1974, we count the years beginning with 1951 and ending with the year before you reached age 63, became disabled, or died before age 63 to find your elapsed years.
(3)
Then we subtract 5 from the number of your elapsed years. This is the number of your benefit computation years; we use the same number of your computation base years in computing your average monthly wage. For benefit computation years, we use the years with the highest amounts of earnings, but they may include years of no earnings. You cannot have fewer than 2 benefit computation years.
(d)
Your average monthly wage. After we find your benefit computation years, we compute your average monthly wage by—
(1)
Totalling your creditable earnings in your benefit computation years;
(2)
Dividing the total by the number of months in your benefit computation years; and
(3)
Rounding the quotient to the next lower whole dollar if not already a multiple of $1.
(e)
“Deemed” average monthly wage for certain deceased veterans of World War II. Certain deceased veterans of World War II are “deemed” to have an average monthly wage of $160 (see §§ 404.1340 through 404.1343 of this part) unless their actual average monthly wage, as found in the method described in paragraphs (a) through (d) of this section is higher.
Notes, amendments, and revision history

Authority

Authority: Secs. 202(a), 205(a), 215, and 702(a)(5) of the Social Security Act (42 U.S.C. 402(a), 405(a), 415, and 902(a)(5)).

Source

Source: 47 FR 30734, July 15, 1982, unless otherwise noted.

§404.222. Use of benefit table in finding your primary insurance amount from your average monthly wage.

20 C.F.R. § 404.222

(a)
General. We find your primary insurance amount under the average-monthly-wage method in the benefit table in appendix III.
(b)
Finding your primary insurance amount from benefit table. We find your average monthly wage in column III of the table. Your primary insurance amount appears on the same line in column IV (column II if you are entitled to benefits for any of the 12 months preceding the effective month in column IV). As explained in § 404.212(e), there is a minimum primary insurance amount of $122 payable for persons who became eligible or died after 1978 and before January 1982. There is also an alternative minimum of $121.80 (before the application of cost-of-living increases) for members of this group whose benefits were computed from the benefit table in effect in December 1978 on the basis of either the old-start computation method in §§ 404.240 through 404.242 or the guaranteed alternative computation method explained in §§ 404.230 through 404.233. However, as can be seen from the extended table in appendix III, the lowest primary insurance amount under this method is now $1.70 for individuals for whom the minimum benefit has been repealed.
Notes, amendments, and revision history

Amendments

[47 FR 30734, July 15, 1982, as amended at 48 FR 46142, Oct. 11, 1983]

Authority

Authority: Secs. 202(a), 205(a), 215, and 702(a)(5) of the Social Security Act (42 U.S.C. 402(a), 405(a), 415, and 902(a)(5)).

Source

Source: 47 FR 30734, July 15, 1982, unless otherwise noted.

Amendments

[47 FR 30734, July 15, 1982, as amended at 48 FR 46142, Oct. 11, 1983]