Q: If I start taking Social Security at age 62 vs. my full retirement age of 66, will my pension count against me for tax purposes?

A: There are two issues to look at when taking Social Security benefits prior to your full retirement age. One is will there be a penalty against your Social Security of $1 for every $2 paid. The second issue is will your Social Security benefit be taxed as ordinary income. Pension income is not considered earned income and, therefore, will not be charged the penalty. You may have to pay ordinary income tax on up to one-half of your Social Security benefits due to your pension and other forms of income.

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