It shouldn't hurt your future Social Security benefits, but it could temporarily bump up your Medicare costs if you're a high earner.
1. Social Security Benefits
The "new filing line" (likely Box 11 on your W-2) is actually there to protect you.The "Special Payment" Rule: Social Security has an "earnings test" if you claim benefits before your full retirement age. Normally, if you earn too much, they withhold some of your benefits. However, distributions from a non-qualified plan are considered "special payments" for work you did in the past.
By reporting these in Box 11, your employer is signaling to the SSA that this money was "earned" in prior years. This prevents the SSA from mistakenly thinking you are still working a high-paying job and cutting your monthly checks.
Now, the increased earnings mak make some of your social security payments more taxable because of an increase in AGI for the year.
2. Medicare Premiums (IRMAA)
This is where you’ll want to keep a close eye. Medicare Part B and Part D premiums are based on your Modified Adjusted Gross Income (MAGI) from two years prior.
The Impact: Since non-qualified pension distributions count as taxable income (appearing in Box 1 of your W-2), they increase your total AGI.
If this extra income pushes you over certain thresholds (e.g., above $103,000 for individuals or $206,000 for couples in 2026), you might be hit with an IRMAA (Income Related Monthly Adjustment Amount) surcharge. This makes your Medicare premiums more expensive for that specific year.
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