Want to verify assertion that Retirees at full age are not liable for taxes on social security income unless still working

[LewisMinaya]

I am a 71 years old retiree receiving social security.
And have been told that because I do not work, my social security income is tax free. Is this true?

[DoninGA]

It depends. 

Social Security Retirement/Disability/Survivors benefits are reported on a form SSA-1099 and the benefits received are to be entered on a federal tax return. The benefits may be taxable depending on the amount of other income you have entered on your tax return.
However, if the Social Security benefits are the Only income to be reported on the tax return, then there is no reason or need to file a tax return.

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

[SteamTrain]

...just a Maybe...

IF your only income is SS, then it is not taxed, and you are not required to file a tax return

BUT

IF you have pension income, IRA, 403b, 457, 401k distributions, interest income, dividends, capital gains.....any other sources of income at all.

Then they all have to be entered into a tax return (including the gross SS) because....up to 85% of the SS can then become taxable, as will be determined by the software.

It is not age limited.

[Opus 17]

"And have been told that because I do not work, my social security income is tax free. Is this true?"

Not exactly.  

If your only income is social security, you are exempt from federal income tax (but not necessarily state income tax, you would have to check with your state).

However, if you have any other taxable income (casino winnings, IRA withdrawal, wages, selling your stamp collection, etc.) then social security may also be taxable according to a complicated formula as discussed here. 

https://www.irs.gov/newsroom/dont-forget-social-security-benefits-may-be-taxable

and here

https://blog.turbotax.intuit.com/income-and-investments/how-social-security-income-is-taxed-7676/

[Opus 17]

"And have been told that because I do not work, my social security income is tax free. Is this true?"

[VolvoGirl]

You might be confusing 2 things.

There are 2 different things to know about social security. People get them mixed up all the time.

1. Your actual SS checks

If you are over full retirement age your actual ss checks won't be reduced. Otherwise they will actually reduce your payments if you make too much other income in the prior year.  See SS FAQ for working after retirement

https://www.ssa.gov/planners/retire/whileworking.html

2. Income Tax

For any age 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