BillM223
Employee Tax Expert

Retirement tax questions

It happens a lot that a person on Social Security only pays no tax on his/her SS benefits.

 

However, there is a formula which determines how much of your SS benefits are taxable (up to 85%), based on other income you receive.

 

Thus it can happen that you take a 401(k) distribution and that this is sufficient other income to cause some of your previously untaxed SS benefits to become taxable. 

 

Look at line 5b on your 1040. This is the amount of SS benefits that are taxable in 2019 (line 5a is the total amount of SS benefits that you received). Compare this to 2018.

 

If you suddenly have a value in line 5b, then this is the reason you appear to be paying 19% on your 1099-R distribution - it's because you are now paying tax on SS benefits as well.

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