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normhaines
New Member

I always received back Voluntary tax withheld 0n SSA 1099 why not this year

 
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Accepted Solutions
BMcCalpin
Level 13

I always received back Voluntary tax withheld 0n SSA 1099 why not this year

There are a variety of reasons why you might owe more tax this year (i.e., not get your withholding back).

The most likely one is that you have income other than Social Security. While Social Security by itself if usually not taxable, when a taxpayer has outside income (W-2, self-employment, retirement plan distributions (1099-R)), then some of the Social Security can become taxable.

Between 0% and 85% of your Social Security is taxable. There is a somewhat complicated formula for how the IRS determines if your Social Security income is taxable. Do the following (for both of you if you are married filing joint):

  1. Take one-half of your benefits; plus
  2. All your other income, including tax-exempt interest.
  3. Add items #1 and #2 together
  4. Determine your "base":

  • ·         $25,000 if you are single, head of household, or qualifying widow(er);
  • ·         $25,000 if you are married filing separately and lived apart from your spouse for all of 2016;
  • ·         $32,000 if you are married filing jointly; or
  • ·         $-0- if you are married filing separately and lived with your spouse at any time during 2016.

      5. If line 4 is larger than line 3, then none of your Social Security benefits are taxable. But if line 3 is greater than line 4, then some of your Social Security benefits are taxable, up to 85% of them.

In short, the larger your "outside" income is (that is, W-2s, 1099-Rs, etc.) is, the more likely that your social security income becomes taxable, to the point that your withholding may not cover it.

View solution in original post

1 Reply
BMcCalpin
Level 13

I always received back Voluntary tax withheld 0n SSA 1099 why not this year

There are a variety of reasons why you might owe more tax this year (i.e., not get your withholding back).

The most likely one is that you have income other than Social Security. While Social Security by itself if usually not taxable, when a taxpayer has outside income (W-2, self-employment, retirement plan distributions (1099-R)), then some of the Social Security can become taxable.

Between 0% and 85% of your Social Security is taxable. There is a somewhat complicated formula for how the IRS determines if your Social Security income is taxable. Do the following (for both of you if you are married filing joint):

  1. Take one-half of your benefits; plus
  2. All your other income, including tax-exempt interest.
  3. Add items #1 and #2 together
  4. Determine your "base":

  • ·         $25,000 if you are single, head of household, or qualifying widow(er);
  • ·         $25,000 if you are married filing separately and lived apart from your spouse for all of 2016;
  • ·         $32,000 if you are married filing jointly; or
  • ·         $-0- if you are married filing separately and lived with your spouse at any time during 2016.

      5. If line 4 is larger than line 3, then none of your Social Security benefits are taxable. But if line 3 is greater than line 4, then some of your Social Security benefits are taxable, up to 85% of them.

In short, the larger your "outside" income is (that is, W-2s, 1099-Rs, etc.) is, the more likely that your social security income becomes taxable, to the point that your withholding may not cover it.

View solution in original post

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