Social Security

[torreschuey2]

Is social security retirement income taxable?

[DoninGA]

Up to 85% of Social Security Retirement/Disability/Survivors benefits 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

[xmasbaby0]

TAX ON SOCIAL SECURITY

Up to 85% of your Social Security benefits can be taxable on your federal tax return.  There is no age limit for having to pay taxes on Social Security benefits if you have other sources of income along with the SS benefits.  When you have other income such as earnings from continuing to work, investment income, pensions, etc. up to 85% of your SS can be taxable.

 What confuses people about this is that before you reach full retirement age, if you continue working while drawing SS, your benefits can be reduced if you earn over a certain limit. (For 2017 that limit was $16,920 —for 2018 it will be $17,040—for 2019 it will be $17,640— for 2020 it will be $18,240)  After full retirement age, no matter how much you continue to earn, your benefits are not reduced by your earnings; your employer will still have to withhold for Social Security and Medicare.

To see how much of your Social Security was taxable, look at lines 5a and 5b of your Form 1040

https://ttlc.intuit.com/questions/1899144-is-my-social-security-income-taxable

https://www.irs.gov/help/ita/are-my-social-security-or-railroad-retirement-tier-i-benefits-taxable

You need to file a federal return if half your Social Security plus your other income is $25,000 when filing single or head of household, or $32,000 when filing married filing jointly, $0 if you are filing married filing separately.

Some additional information:  There are 13 states that tax Social Security—Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, North Dakota, Rhode Island, Utah, Vermont, and West Virginia.  These states offer varying degrees of income exemptions, but four mirror the federal tax schedule: MN, ND,VT, and WV

[Hal_Al]

Social security (SS) only becomes taxable when added to sufficient other income. If you are otherwise required to file a tax return, you do need to enter it in Turbotax (TT). TT will determine the taxable portion.

After TurboTax (TT) calculates the taxable portion of SS, it puts the total amount of SS on line 5a of form 1040 (2019) and the taxable amount on line 5b (lines 6a & 6b on 2020 form 1040) . TT also produces a worksheet  to show how the taxable amount is calculated. Although most people pay tax on 85% of their SS, it can be less, or even 0, for lower income taxpayers.

How much  is "sufficient other income"? The simple answer is $12,400 (a single person's filing requirement). But the answer varies dependent on marital status, filing status, age, the amount of your Social security, and whether you are claimed as a dependent by someone else.