As a freelancer, you may be wondering whether or not you'll qualify for Social Security retirement benefits upon reaching the age of retirement. The answer to that question is you absolutely will, as long as you meet the eligibility requirements set forth by the Department of Social Security. Read on to learn what those requirements are.

You Must Have Worked For A Certain Length Of Time

Social Security utilizes a credit system. In order to receive benefits, you must have banked enough credits prior to applying. Each $1200 you earn in a year is equivalent to a single credit, and the maximum allowance of credits in any given calendar year is 4. Your age is the primary determining factor of how many credits you'll need to qualify.

Anyone born in 1929 or later must have a total of 40 credits (maximum credit amount for 10 years worked) in order to qualify for full Social Security retirement benefits. Applicants may subtract 1 credit from the requirement for each year they were alive prior to 1929. These credits do not need to have been accrued over consecutive years worked; for example, you could work for 5 years, not work for 10 years, and then work for 5 more years and still meet the requirements for Social Security retirement benefits.

You Must Have Paid Enough Social Security Tax Into The System

If you worked for an employer, that employer would withhold 6.2 percent of your earnings (up to $117,000) for Social Security tax. They would also withhold 1.45 percent of your wages for Medicare tax. Before your employer sends these taxes off to the IRS, though, they match the contribution for a combined total of 12.4 percent Social Security tax and 2.9 percent Medicare tax.

As a freelancer, you are self-employed and have nobody to match your contribution; you must pay both shares of the taxes and send them to the IRS yourself. How much in taxes, total, do you need to pay in order to qualify for Social Security retirement benefits? You must pay the full amount of taxes on the required number of credits you need to qualify for the benefits.

To further explain, a person born after 1929 needs 40 work credits to qualify for retirement benefits. He or she can earn 4 credits a year, and each credit is achieved by earning $1200. This person will need to earn $4800 for at least 10 years of their life in order to earn enough credits to qualify. If this person is self-employed, they'll also need to have paid 12.4 percent social security tax and 2.9 percent Medicare tax on the entirety of those 10 years of earnings.

You Must Meet Income Eligibility

If you are employed by a third party, you are entitled to earn a clear-cut $1070 a month without losing Social Security retirement benefits eligibility. When you're self-employed, though, the process for determining how much money you can make without losing benefits becomes much more complicated.

The Department of Social Security uses a series of 3 tests to determine whether or not a self-employed person performs substantial gainful activity. These tests measure how important a person is to their business operations, how much financial gain the person actually receives in a year, and how the person's work compares to that of the average worker in their community.  

If it is deemed that your work does qualify as substantial gainful activity, you will not qualify for social security benefits. As these qualification tests rely on somewhat objective information, it's best to contact a Social Security attorney before applying for benefits. Your lawyer can make sure that you are evaluated fairly by the Department of Social Security.

Just because you are self-employed as a freelancer does not mean that you won't be eligible for Social Security retirement benefits. As long as you satisfy the above 3 requirements, you'll be entitled to full benefits upon reaching retirement age.