@BigPopaE @ldruth61
Sorry guys....it is the both of you who are not getting it.
This is a long-established SS benefits procedure, AND TTX is getting it correct, and has been correct for many years.
1) Issue #1: Yes, SS says that If you have too much "earned income" from an actual job before you reach "Full" retirement age...then SS will actually reduce the $$ that SS sends you monthly the next year. It is correct that pensions are not included in this....but that reduction is not displayed on your current tax return itself, because it is not an actual income tax....it happens by SS actually not sending you some $$ in the next year's monthly SS benefit payments to you.
2) Issue #2: The "up-to" 85% tax on your SS benefits. That is a separate tax that IS included on your current tax return. For that actual current income TAX assessed on the SS benefits that you did receive from SS, that "income tax" IS assessed on your current tax return, and does include all your other taxable income, including pensions, (also, plus tax-exempt Muni bond interest) to determine whether any of this year's SS income will be taxed this year.
Can #1 and #2 result in a double-hit to your SS benefits?
Yep, sure can...until the year after you reach full SS retirement age.
But TurboTax only deals with calculating issue #2.
The SSA will deal with #1 separately from your tax return.
____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*
