MFJ, I am retired and started receiving SS in February 2025. My wife has an income of $35k/yr. We have A LOT of investment dividends. We are currently only having tax withheld on my wife's income via her W4. Should we be sending in quarterly tax payments? If so, how much? If not, how much should we set aside to pay when we file?
Whenever a taxpayer begins receiving social security benefits, a portion of that income is taxed if income received in addition to social security is above a "base amount". For married filing joint (MFJ) taxpayers, the base amount is $32,000 for 2025.
If combined income is below this base amount, then there is no tax on the benefits.
If combined income is between the $32,000 and $44,000, up to 50% of your benefits become taxable.
If combined income is above $44,000, up to 85% of your benefits become taxable.
The amount of taxable benefits is added to taxable income and taxed at your nominal rate.
If you believe that your current withholding will not suffice to cover the tax liability for the year, you can either request more by adjusting your W-4 with your employer, or pay quarterly estimates to the IRS. The amount will be dependent on what your overall tax bracket is.
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