Simple English definitions for legal terms
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Work credits are points earned by working and earning a certain amount of money each year. The government uses these credits to decide if someone is eligible for Social Security benefits, Social Security Disability Insurance (SSDI) benefits, and Medicare. You can earn up to four credits each year, and in 2021, you earn one credit for every $1,470 you make. The number of credits you need to qualify for benefits depends on the program, but for Social Security, you need 40 credits. Medicare also requires 40 credits for full coverage, but you can still get some coverage if you have fewer credits. For SSDI benefits, the number of credits you need depends on your age when you become disabled.
Definition: Work credits are a way for the Federal government to determine if a person is eligible for Social Security benefits, Social Security Disability Insurance (SSDI) benefits, and Medicare. A person earns a credit for a certain amount earned in wages, up to four credits every year. In 2021, a person earns a credit for $1,470 in wage earnings. Each program has its own policies for how many credits are needed for benefits.
These examples illustrate how work credits are used to determine eligibility for different government benefits. The number of credits needed varies depending on the program and the age of the person. Work credits are earned by working and earning a certain amount of money in wages. The more credits a person earns, the more likely they are to be eligible for benefits.