Greetings,
I have a tax planning dilemma that the community may help with. My wife and I file a married joint tax return. I will be 73 and she will be 68 as of 12/31/25. We try to keep our taxable income as low as possible. 2025 is the first year I had to pay a RMD, which I planned to give to our church as a Qualified Charitable Distribution. Hence, our only taxable income is social security benefits ($59,295 combined) and interest/dividend income ($9,000 =/-). Based on our age and income, we have no tax liability with the standard deduction.
We have solar panels on our home installed in 2022. We are adding a battery back-up system which will cost $21,500. By having this installed by 11/1/2025, we can receive a tax credit of $6,450.
This is the dilemma--as I understand it, if our income exceeds $44,000 in 2025, we will pay federal taxes on 85% of our social security. How, we are only taxed at 50%. (I believe)
How can I calculate how much additional income from my 401k I need to take to reach at least at $6,450 tax liability? And, how much more of our social security is taxed in the process? Do I wind the battle and lose the war?
Thank you very much.
Jesse
