A worker’s FRA depends upon. his/her birth date as follows:

FRA is age 66 for workers born after 1942 and before 1955;

FRA is age 67 for those born after 1959; and

FRA gradually increases from age 66-67 for those born after 1954 and before 1960.

Tax and legal professionals with clients who are approaching age 62 may wish to discuss with them the various benefits and drawbacks to taking Social Security benefits before, at and after FRA.

Key Considerations

If an individual lives to average life expectancy for someone his or her age, the present value of the Social Security retirement benefits he/she receives will usually be similar regardless of when benefits begin, so the decision regarding when to start receiving benefits often depends upon factors other than trying to receive the greatest lifetime benefit from Social Security. Some individuals delay retirement and continue to work because of personal preferences. Others need to take early Social Security benefits because they are unemployed, underemployed or have an immediate financial need. Those in a better financial situation might be able to delay receipt of benefits, allowing their monthly benefits to in CCSC.

With the exception of those who reach age 62 and need income or those with a shorter life expectancy, most workers should carefully consider the long-lasting advantages of waiting until their FRA to receive their Social Security benefits. A number of factors must be taken into consideration when making this decision.

Life Expectancy

An individual’s life expectancy may be the biggest factor in deciding whether to start benefits carly. Life expectancy tables and averages are available, although an individual’s current health and parents’ longevity should also be factored in. As a general rule, if an individual reasonably expects to reach age 80, waiting to take benefits until he/she reaches FRA may be a wise choice.

Shortening the Retirement Period 

A significant factor in retirement planning projections is the length of the retirement period. For example, if an individual wants to retire at age 62 and has a life expectancy of 85, a 23-year retirement period must be funded. By working past age 62, an individual shortens the retirement period and decreases the resources needed to fund his or her retirement, regardless of longevity.

Replacing Lower-Wage Years

An individual’s Social Security benefits are based upon his or her primary insurance amount (“PLA”). The PLA is calculated using an individual’s highest 35 years of indexed earnings. If an individual can replace lowerwage years with higher-wage years after age 62, the PLA can be increased. This can lead to a greater benefit when the individual retires.

Inflation Adjustments

Social Security benefits are subject to an annual inflation adjustment. By taking early benefits, an individual’s starting base for annual adjustments is smaller. For example, an individual with a PIA of $2,000 who begins benefits at age 62 will receive only $1,500 per month and will miss out on the compounded inflation adjustment for the $500 in lost benefits.

Deciding When to Start Receiving Social Security Benefits, Part 1

Spousal Benefits

When a worker reaches FRA and begins taking benefits, his or her spouse also becomes eligible for spousal benefits equal to 50% of the working spouse’s PIA. A spouse may need to rely upon spousal benefits if he or she has no history of personal earnings or if his or her PLA is less than 50% of the working spouse’s. If the working spouse takes early benefits, the reduction in his or her PIA also affects the spousal benefit amount.

The Earnings Test

An individual’s reduced early retirement benefit may be reduced even further between age 62 and FRA if he or she takes early benefits and also continues working. Individuals who intend to keep working beyond age 62 must consider the impact 9f the carnings test, which reduces benefits by S1 for every $2 in carnings above an exempt threshold (S15,120 for 2013) during years the individual has not yet reached FRA.

Any reduction due to the earnings test is later recouped because benefits at FRA are increased to take such reductions into account.

Charlie begins receiving Social Security benefits in 2012 at age 63. In 2013, he works part-time and earns wages of S16,120, which is $1,000 over the exempt amount. Charlie is in the 25% marginal tax bracket (because of additional taxable income), and 85% of his Social Security benefits are included in his Charlie’s benefits are reduced S1 for each S2 he earns over the exempt amount. Charlie’s additional spendable portion of the additional $1,000 in earned income after considering taxes and the loss of Social Security benefits is only $279, calculated as follows:

-Earnings over the exempt amount: S1,000 -Social Security/Medicare tax on $1,000 (7.65%). (77)

-Income tax on S1,000 (25% marginal tax bracket): (250) -Loss of Social Security benefits (S1,000/2): (500) -Tax savings from $500 reduction in benefits (S500 x 85% x 25%). 106 Additional spendable amount: S279

In the next issue, we will discuss the following:

-Advantages of Taking Reduced Benefits at Age 62;

-Advantages of Taking Delayed Benefit after Reaching FRA; and

-Strategies for Increasing Retirement Benefits.

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Before bidding on a property at tax sale, you should be thoroughly familiar with the current physical condition of the property.

current physical condition of the property, having personally seen it and preferably having inspected it. While you cannot trespass on private property, it is worthwhile to approach the owner for information and permission to inspect. You should also be aware of the existence of mortgages or other tax liens that may survive the sale,

An interesting example of the perils of tax sales had an unhappy ending for a novice purchaser. A Pennsylvania man purchased a property at tax sale, only to later discover that it had been condemned and that a trailer park on the property was closed due to the failure of the on-site sewage treatment facility. On making these discoveries after having purchased the property, the man demanded, his money back from the county tax claim bureau, and when the bureau refused to refund the purchase price, he sued.

The bureau defended its position, claiming that it had no obligation to advise bidders at real estate tax sales of condemnations or sewage problems. Further, it claimed that since thousands of properties are put up for tax sale each year, it would be economically unfeasible for the bureau to investigate and report accurately on the condition of each property.

The court noted that while priwate sellers have obligations to disclose their knowledge of the condition of their property, such requirements would be a “heavy burden’ on tax claimbureaus—a burden not yet imposed by the legislatures and not one that could be dictated by the Courts.

It is wise to secure legal advice on the laws about tax sales before buying. While some exceptional real estate bargains can be encountered at tax sales, differentiating the bargains from the fiascos can be accomplished only by thorough investigation and a keen understanding of tax sale laws.

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Will ful misconduct can come from a single incident and can occur even when apparently minor rules are broken by the employee unintentionally. In one case, a truck driver hit a light standard while backing up, causing an undetermined amount of damage to the company truck and more than $6,000 in damage to the light standard.

The employer had a policy requiring its drivers to walk completely around their trucks before backing up; the employer fired the driver for failing to have followed that rule. The fired driver explained that he had stopped to make a business-related call and then backed the truck up without walking around it, assuming that it was safe to backup. He argued that his failure to walk around the truck was negligent but was not willful, since he had not made a deliberate decision to break the rule.

The court disagreed. Noting that there was no “mistake’ in the employee’s conduct, the court focused on the fact that the driver knew of the rule and simply disobeyed it.

But an employee who posted two signs at the workplace referring to fellow employees as “morons’ won his unemployment claims when the court found that “moron” is not a threatening word or one “totally outside the bounds of what one might expect to hear in a large and busy warehouse.”

In that case, the fired employee was concerned that fellow employees might try to use an inoperable and hazardous battery. He posted a sign that read “To the moron who can’t read this, do not use this battery.’ Prior to his posting his strongly worded sign, employees had torn his “Do Not Use” signs off several defective batteries.

When an employee complained to the human resources director on the assumption that he was the target of the moron signs, the sign poster was fired for breaking the Workplace rule against “threatening, intimidating or coercing” fellow employees. The court found that the use of abusive, Vulgar, or offensive language in the Workplace is willful misconduct even where the employer does not have a specific rule prohibiting rough language.

However, where offensive or profane language is provoked or amountstoaminor event, it does mot constitute willful misconduct. In the case of the sign poster, the appeals court decided that the moron signs were purposed toward conveying the urgent need for caution and were not threatening or coercive.

Resolution of legal issues depends upon many factors, including variations of facts and interpretations of Pennsylvania law. This newsletter is not intended to provide legal advice on specific subjects, but rather to provide insight into legal developments and issues. The reader should always consult with legal counsel before taking action on matters covered by this newsletter,

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In this case, the worker slipped on what appeared to be cooking oil that had leaked from the dumpster. He testified that he fell suddenly when his feet”came outfiom underneath’ him all at once and he landed “hard on his hands and knees.’ His hands were sticky and smelled of cooking oil immediately after the fall. The injured man claimed that the foodservice company’s careless dumping of cooking oil had been the cause of his fall.

The court noted that the food service company’s first obligations were directly to the plant operator, The court also observed that generally, a party to a contract does not become liable to third parties if the contract is breached. But where strangers to a contract are at risk of harm if aparty does not perform its contractual obligations carefully, the laws of negligence do extend liability to the contract party,

In this case, plant management employees testified that the plant managed the dumpster but that plant regulations required that the food service company place cooking oil in trash bags or sealed pails. On the day of the injured man’s fall, plant employees noticed that there was an old box of cooking oil in the dumpster that had not been sealed in a pail or trash bag. Plant employees also testified that because of the hazards ice poses to trash collectors, holes had been drilled in the bottoms of the dumpsters to prevent ice buildup in winter and that the food service company was aware of the holes,

The court found that the food service company had contracted with the plant to provide for the safe disposal of cooking oil according to plant procedures. The court found further that the injured man was entitled to present at trial his claims that the foodservice company’s failure to dispose of the cooking oil safely had caused his injuries.

If you are injured at work or elsewhere, be sure to carefully review which persons and entities are involved in, and what their responsibilities are for, maintaining the safety of the place where you were injured. If you are an employer, make sure that your contracts with service providers clearly define the standards of workplace safety.

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To be privileged, your statements to your lawyer’s employee must have been made to initiate an attorney-client relationship with your lawyer or to secure ongoing legal advice. Your statements must have been made in privacy-you may lose the privilege by speaking within hearing of strangers. If your statements are found to be within the privilege, Pennsylvania law prohibits the use of the statements against you in court. In addition, confidentiality is a two-way street: Your lawyer’s communications to you are also confidential and privileged.

Whenever you speak to your attorney or to his or her staff, you should be sure to do so in private. Discussing your legal affairs over the phone in a public place where you can be overheard or making statements in front of other people in your lawyer’s reception area must be avoided. The protection of the privilege is valuable and can be jeopardized or limited by loose or loud talk.

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A website owner had created an independent website that regularly published news and articles critical of local government. Readers were invited and encouraged to register as members of the site. Registered members could create unique usernames and post comments under those names. Only registered members could post comments to the site, and they typically posted using pseudonyms rather than their real names. The website owner had control of a database that included the email addresses and names given by the people who registered on the site.

The case started when the website owner sued a former city council president, claiming that the former council president had defamed him on a political website and made terroristic and death threats against him. In response, the former council president countersued, claiming that the website owner had regularly published numerous defamatory statements about her that had injured her reputation and caused her personal humiliation, political harm, and embarrassment.

The former council president named nearly 100 additional defendants in her suit, allidentified simply as John Doe, all of whom were anonymous posters on the website owner’s website. Simultaneously with the filing of her countersuit, the former council president also filed a petition to compel the website owner to immediately disclose all the names of his website members, identifying each by real name, email address, and pseudonym,

The trial court first ordered the website owner to preserve all his data about the website members, pending a full hearing. The judge then ordered the former council president to narrow her request by specifically identifying the particular posted messages that she claimed had defamed her. He also ordered the website owner to promptly forward the court filings to all the registered members on the website by email so that all the individual posters would have notice of the pending proceedings.

Once the former council president had identified the particular postings that she claimed were defamatory, the judge issued a court order requiring each website member involved in those limited posts to file a written objection to the disclosure within 30 days of receiving the court papers from the website owner by email.

After further proceedings, the trial court ordered the website owner to disclose the names and identities of some of the anonymous message posters. The trial judge recognized that the First Amendment protects the right to speak anonymously but noted that an individual’s right to protect his or her own good name is also constitutionally protected. Defamation law, the judge said, “reflects no more than our basic concept of the essential dignity and worth of every human being-a concept at the root of any decent system of ordered liberty.”

The trial judge also observed that the U.S. Supreme Court has extended defamation liability to Internet communications. The Supreme Court has said that through the Internet anyone “can become the town crier with a voice that resonates farther than it could from any soapbox.”

On appeal, because disclosure of anonymous posters’ identities had not yet been addressed by any Pennsylvania appeals court, the appeals court returned the case to the trial judge with specific directions. The appeals court created a fourfactor test that Pennsylvania trial judges should henceforward apply in all similar cases.

First, the court noted that anonymous posters are entitled to receive notice of the case and to have an opportunity to object to the disclosure of their identities before the decision about disclosure is made.

Second, disclosure as to particular posters should be ordered only if their particular posted messages appear to be defamatory.

Third, the party seeking disclosure must sign a sworn statement that the information is essential to his or her case and is otherwise unavailable.

Fourth, the trial judge must balance the interests of all parties. Balancing the parties’ interests focuses on how defamatory the posted comments were, how many comments were posted, and how likely it is that the party seeking disclosure will prevail in the case. The trial judge must also consider that comments about matters of public importance or critical of public officials are entitled to heightened protection from disclosure because public comment on public issues is entitled to “robust protection” under the First Amendment,

The appeals court declared that because debate on public and political matters “may well include vehement, caustic and sometimes unpleasantly sharp attacks on government and public officials,” trial judges must tolerate spirited public comments. Comments online directed to private persons and priwate matters warrant less tolerance in the analysis ofwhether the content of the comment is defamatory.

If you post comments on any websites or blogs using a pseudonym, you can’t be confident that your identity will remain private. Be careful to tone down your rhetoric when commenting on private people or events. But while political speech is more protected than comments on private matters are, even political postings can lead to the disclosure of your identity if a trial judge finds disclosure to be fair.

Methods exist to trace your posting to your home or office computer even if you register on the website under a false name. Using a workplace computer to post defamatory comments can lead to Workplace sanctions or even termination.

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