This is very helpful. Thank you.
Is it accurate then to say that if your unearned retirement income from interest and dividends exceeds $200K as a single filer, than the 85% of social security that is taxable is also subject to the additional 3.8% tax because your modified AGI minus $200K is always going to be lower than the unearned retirement income. Expressed as a formula where x is the unearned retirement income and y is the taxable social security benefit:
(X+Y - 200,000) < X where X > 200000.
So if unearned retirement income is 250,000 and Social Security Income is 20,000 then,
200000 + 20000 - 200000 = 20000 which is less than 200,000 and therefore, the entire 20,000 of social security income is subject to the 3.8 tax.
So my statement that social security is subject to the 3.8% tax is accurate IF unearned retirement income is greater than 200,000.
Do I have that right?
Thank you!
