topic Do I need to pay taxes on $30,000 Soc Sec and $6500 annuity. I am 71 in Retirement tax questions

Do I need to pay taxes on $30,000 Soc Sec and $6500 annuity. I am 71

loygary — Mon, 03 Jun 2019 17:15:01 GMT

I read that I only pay taxes on 1/2 of Soc Sec and the annuity and if those 2 things don't exceed $25000 then I don't need to pay.... ??????

You are correct, you do not pay tax on any on any of that...

Hal_Al — Mon, 03 Jun 2019 17:15:02 GMT

You are correct, you do not pay tax on any on any of that income. You are not even required to file a tax return, unless you need to get a refund on any mistaken withholding.

Your understanding, of the situation, is essentially correct, but not exactly (taxes are complicated and convoluted).

Social security becomes taxable when your income, including 1/2 your social security, reaches:

Married Filing Jointly(MFJ): $32,000

Single or head of household: $25,000

Married Filing Separately and lived with your spouse at any time during the tax year: $0

So, half of $30,000 is 15,000. $15,000 + 6500 = 21,500 and that is less than $25,000; so none (0%) of your SS is taxable. So, 0 taxable SS + $6500 taxable pension is less than the $12,000 ($13,300 if over age 64) filing threshold; so you don't need to file.

TAX ON SOCIAL SECURITY Up to 85% of your Social Security...

xmasbaby0 — Mon, 03 Jun 2019 17:15:05 GMT

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 is $16,920 —for 2018 it will be $17,040—for 2019 it will be $17,640) 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.

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.