Taxes on Annuities and SS when I retire?

[BKPAKP]

Hello, Thanks in advance for your information...  when I retire next year at FRA (66.6) our income will then be made up of two annuities and my FRA SS.

What taxes would (could) we have? Could there be SS tax?

Thanks, Brian

[carmen_t]

Hello Brian and thank you for your question.  Based on this new change you will have annuities/pension income along with social security benefits.  Some or all of your social security benefits may be taxable depending on total income.  The annuities/pension that will be received will count towards calculating income to determine if any or a percentage to potentially all benefits will be added to taxable income.  I will send a tax estimator calculator link with a couple good articles from the social security website and turbo tax to explain the effects.  Hope this answered your question.

Refund Estimator 

Social Security Article 

TurboTax Article 

[GCEA · Accepted solution]

Hi @BKPAKP ,

Congratulations on your upcoming retirement!

Annuities payments can make up to 85% of your Social Security taxable. The type of annuities and how you funded the annuities ( pretax monies or after-tax dollars) will impact your tax liability differently.

Annuity Taxation

If pretax monies from a qualified retirement plan, such as a 401(k) or IRA, are used to purchase an annuity, then all payouts are taxable just like other withdrawals from DC plans. If after-tax dollars, such as those from a Roth IRA, are used to purchase an annuity, then the portion of the payout that represents return of principal is not taxed (https://www.ssa.gov/policy/docs/issuepapers/ip2017-01.html)

Annuity Payments and Social Security Taxation

If the taxable amounts of the annuities payments add up to more than $25,000 for an individual or $32,000 or a married couple filing jointly, you pay federal taxes on a portion of your benefits, regardless of your age.

For individual filers, if your combined income* is:

• Between $25,000 and $34,000, you will owe taxes on up to 50% of your Social Security benefits or
• Greater than $34,000, you will owe taxes on up to 85% of your Social Security benefits

For joint filers, if your combined income* is:

• Between $32,000 and $44,000, you will owe taxes on up to 50% of your Social Security benefits or
• Greater than $44,000, you will owe taxes on up to 85% of your Social Security benefits

For more detailed information regarding Annuities and Pensions , please go to :

- Topic No. 410, Pensions and Annuities

- What Income Is Included in Your Social Security Record? 

- Social Security and paying taxes in retirement 

Thank you and good luck!