earnings in addition to Social security

[tportelli]

If I start collecting social security at 65 when my full retirement age is 67 how much additional earnings am I allowed each year?

[ElizabethW2]

Hello!

For 2023 the earnings limit is $21,240.  I've included a link to Social Security's website below that has this and other information that may be helpful to you.

Be aware, this amount changes each year so be sure to check for 2024 if you postpone retirement.

Regards,

Elizabeth W

EA for 29 years

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[tportelli]

do interest and dividends count towards this amount?

[ElizabethW2 · Accepted solution]

No.  Additionally, any other retirement income is NOT included for this limitation.

Only earned income is included for this limit.  In other words, you have to trade hours for dollars.

Regards,

Elizabeth W

EA for 29 years

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[Bozaya1]

If you are under full retirement age for an entire year, SSA will deduct $1 from your benefit payments for every $2 you earn above the annual limit. For 2023, that limit is $21,240.

In the year you reach full retirement age, they will deduct $1 in benefits for every $3 you earn above a different limit. Starting with the month you reach full retirement age, there is no limit on how much you can earn and still receive your benefits.

Hopefully this answers your question. Feel free to reply if you have any additional questions.

Below are links for additional information:

https://turbotax.intuit.com/tax-tips/irs-tax-return/a-guide-to-social-security-tax/L5QxGNcJL

https://www.ssa.gov/benefits/retirement/planner/whileworking.html#:~:text=If%20you%20are%20under%20f....

[tportelli]

how are will my taxes be affected when  I start collecting social  security which may be in 2 years?  I am married and my wife works and we have always filed jointly?

[BonnieI]

Hi @tportelli thank you for joining us today for our TurboTax Live Event.  

The Tax Experts, @ElizabethW2  & @Bozaya1 have provided great information regarding earnings while collecting social security and before full retirement.

Below are some additional tools to estimate your 2023 Individual income tax and determine your tax brackets for 2023:

TurboTax's TaxCaster tax calculator:

https://turbotax.intuit.com/tax-tools/

2022 and 2023 Tax Brackets:

https://turbotax.intuit.com/tax-tips/irs-tax-return/current-federal-tax-rate-schedules/L7Bjs1EAD

Hope the information we have provided is helpful.  Please reach out if you have additional questions.

Thanks for using TTLive!

Bonnie, TTLive Tax Expert

[VolvoGirl]

Up to 85% of Social Security becomes taxable when all your other income plus 1/2 your social security, reaches:

Married Filing Jointly: $32,000

Single or head of household: $25,000

Married Filing Separately: 0

See this Social Security page for taxes on your benefits
https://www.ssa.gov/benefits/retirement/planner/taxes.html

[ElizabethW2]

Your social security can be subject to tax on your joint return, up to 85% of your benefits.  If you earn between $25,000 and $34,000 per year as a single filer (or $32,000 to $44,000 if you’re married filing jointly), you will pay income taxes on up to 50% of your Social Security benefits. If you earn more than $34,000 (or $44,000 if you’re married filing jointly), you’ll pay taxes on up to 85% of your benefits. You will never be taxed on more than 85% of your Social Security benefits.

There is a worksheet in the IRS instructions for preparing your Form 1040.  Here is the link to that site.  Go to Page 32.

Link to IRS Form 1040:  www.irs.gov/pub/irs-pdf/i1040gi.pdf

Our TaxCaster app can help you see what the tax due will be.  Here is that link:  https://turbotax.intuit.com/tax-tools/calculators/taxcaster/

Regards,

Elizabeth W

EA for 29 years

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[tportelli]

not a helpful answer. let's try it this way. how is social security taxed?

[ElizabethW2]

From your tax return 

Your Adjusted Gross Income (AGI)

+any non-taxable interest

+50% of your social security benefits

If this total (on your married filing joint return) is greater than $32,000, your social security benefits are going to be taxed.  The amount of the benefits is determined by how much your calculation above exceeds the $32,000.  The worksheet I referenced above in the Form 1040 instructions, Page 32 will let you use your actual figures to determine the taxable amount.

Elizabeth W