Social Security is the steadiest paycheck most people bring to Costa Rica, and the amount doesn't shrink at the border. What decides how far it carries you is the age you claim it and how the IRS counts it.
Can you collect Social Security while living in Costa Rica?
Yes. US citizens can generally keep collecting their full Social Security benefit in Costa Rica, at the same amount they'd get in the US. Cost-of-living raises follow you too, including the 3.6% COLA that starts in January 2027. Costa Rica generally doesn't tax the benefit, since its territorial system leaves foreign-source income alone.
| Claiming age (born 1960 or later) | Share of full benefit | Monthly on a $2,000 full benefit | Earnings test applies? | Waiting breaks even around |
|---|---|---|---|---|
| 62 | 70% | $1,400 | Yes, until 67 | Age 78 (vs. 67) |
| 67, full retirement age | 100% | $2,000 | No | Baseline |
| 68 | 108% | $2,160 | No | Age 80 and a half (vs. 67) |
| 70 | 124% | $2,480 | No | Age 82 and a half (vs. 67) |
Those percentages come straight from SSA's tables. The dollar column's illustrative. Your own full benefit's on your statement at ssa.gov.
When should you claim Social Security if you're moving to Costa Rica?
On paper, waiting wins if you live long enough. The check at 70 is 77% larger than the check at 62. That gap's permanent. And every COLA gets applied to the bigger number.
So the real question is how long you expect to collect. The break-even math below uses the $2,000 example.
Illustrative: claiming at 62 versus 67
- Claim at 62: $1,400 a month for the 60 months until 67 = $84,000 collected.
- Claim at 67: $2,000 a month, which is $600 more each month.
- Months for the extra $600 to make up $84,000: $84,000 ÷ $600 = 140 months.
- 140 months is about 11 years and 8 months, so waiting pulls ahead near age 78 and 8 months.
That ignores COLAs and investment returns. It's a rough line. It's still useful.
But a move abroad changes what happens before that line. If you wait, something else pays your bills from 62 to 67. Usually that's your portfolio. If you claim early, the check covers part of the budget. Your portfolio carries less.
Neither one's right for everyone. If you're healthy and your savings can cover the gap, waiting buys a bigger lifetime check. If your savings are thinner, or your Costa Rica budget's close to the early check, claiming sooner keeps more money invested. That's the tradeoff. Is it just you, or a spouse too? For couples, the higher earner's claiming age matters twice, because that larger check can become the survivor's check.
Do you have a timeline? The claiming decision and the move date affect each other, because the move changes your budget in the years before a check starts. Part of the planning work I do is the money around the check: which accounts carry someone until benefits start, and how much of each deposit sits in dollars versus colones.
How is Social Security taxed when you live in Costa Rica?
Start with Costa Rica. Its income tax is territorial, so foreign-source income generally isn't taxed there (Ley 7092, article 1). A US benefit is foreign-source from Costa Rica's view. That's the easy half.
The US side still applies. Citizens owe US tax on worldwide income wherever they live. Moving doesn't change that. Your benefit becomes partly taxable once your combined income crosses a base amount. Combined income is your other income plus half your benefit. The base is $25,000 for a single filer and $32,000 on a joint return. Above that, up to 85% of the benefit's taxable.
The foreign earned income exclusion won't help here. It covers earned income only. Social Security isn't earned income.
Illustrative: a married couple filing jointly
- Social Security for both spouses: $40,000 a year. Half of that is $20,000.
- IRA withdrawals: $30,000.
- Interest and dividends from a US brokerage account: $6,000.
- Combined income: $20,000 + $30,000 + $6,000 = $56,000.
- That's $24,000 over the $32,000 joint base, so part of the benefit is taxable.
- Run through the Publication 915 worksheet, about $16,200 of the $40,000 is taxable at this level. The 85% cap ($34,000) applies only at higher incomes.
Only part of the benefit is usually taxable, and the worksheet gives the exact figure. What moves it most? The other income. If money was converted to a Roth before claiming, qualified Roth withdrawals later don't count toward combined income (tax laws may change). A conversion's got its own tax bill up front, and it's covered in the post on how your IRA and 401(k) are taxed from Costa Rica.
You can also have SSA withhold federal tax from each payment, at 7%, 10%, 12% or 22%. That way there's no large bill in April. The rest of your US filing picture lives in the guide to US tax obligations while living in Costa Rica.
Can you work remotely from Costa Rica and collect Social Security?
You can. But before full retirement age, the earnings test can hold back part of your check. It's SSA's rule, and it doesn't care where you live.
For 2026, SSA deducts $1 for every $2 you earn above $24,480. For 2027, that limit rises to $25,560. In the year you reach full retirement age, a higher limit applies. Once you're past it, there's no limit at all.
Illustrative: remote consulting at 63
- Earnings from work in 2027: $45,560.
- Amount over the $25,560 limit: $20,000.
- Withheld: $20,000 ÷ 2 = $10,000 of benefits.
- With a $1,400 monthly check, that's about seven months of payments held back.
Those withheld months aren't gone. SSA recalculates your benefit at full retirement age to credit them. The cash flow hit's still real. And work done outside the US can fall under separate SSA rules. If you'll keep working, confirm how SSA treats your situation before you file.
Where should your Social Security check land in Costa Rica?
Most people keep the deposit going to a US bank account. It's already set up. It keeps working while you're sorting out life in Costa Rica.
SSA also offers international direct deposit to banks in many countries. Check its current list before you count on that for Costa Rica. And don't assume a local account's easy to open. Non-residents can often open only simplified accounts with deposit caps and heavy paperwork. The details are in the guide to banking in Costa Rica for expats.
Your benefit's paid in dollars. Your groceries and rent in Costa Rica may be priced in colones. When the exchange rate moves, the same check buys more or less. How much of your budget is truly fixed in dollars? That's worth knowing before you land.
Once you've moved, update your address with SSA. It takes minutes. The Federal Benefits Unit at the US Embassy in San José handles Social Security questions for people living in Costa Rica.
What happens to Medicare when you move to Costa Rica?
Medicare generally doesn't pay for care in Costa Rica. That's what turns Part B into a real decision. There's no pause button. Drop it, and you face a permanent surcharge of 10% for each full 12 months without coverage, with re-enrollment only in the General Enrollment Period from January 1 to March 31. The full tradeoff is in the post on Medicare when you live in Costa Rica.
What to do next
If you're planning a move in the next year or two, the claiming age is one of the first numbers to settle. It decides how hard your savings work in the early years. The Cross-Border Readiness Quiz shows where your plan stands on income timing, taxes and the other pieces of the move. 350+ Americans have taken the Cross-Border Readiness Quiz. Take the quiz here.
If you'd rather talk it through, book a free call. It's about ten minutes of questions about your situation, then a straight answer on whether I can help.
Sources: SSA, payments outside the United States; SSA, benefit reduction by claiming age; SSA, delayed retirement credits for those born 1960 or later; SSA, 2027 COLA and earnings limits; IRS, Topic 423 on taxing Social Security benefits.
This post is educational and does not constitute personalized investment, tax, or legal advice. Vitality Wealth Planning, LLC is a registered investment adviser. Registration does not imply a certain level of skill or training. Tax laws change; verify current rules with a qualified professional.