My client is 70 and has started taking benefits on his record. His wife is 62 now and working. When I run the report for first few years she hardly gets any benefits base on her husband’s record. Does income adjustment also apply to spousal benefits?
Yes spousal benefits before full retirement age are also adjusted for a person’s earned income.
If a person is working (W2 income) and simultaneously taking Social Security benefits before attaining the full retirement age, the benefits are reduced until the person attains the full retirement age. However, at full retirement age, SSA recalculates the benefits.
Read more about this topic at https://faq.ssa.gov/link/portal/34011/34019/article/3739/what-happens-if-i-work-and-get-social-security-retirement-benefits