topic Social security tax in Retirement tax questions

Social security tax

Jbob5 — Thu, 29 May 2025 23:52:04 GMT

How does Social Security tax withheld not get subjected to federal income tax if it is not reported anywhere on income tax return.

Re: Social security tax

VolvoGirl — Fri, 30 May 2025 00:13:01 GMT

Not understanding. You enter the SSA-1099 for Social Security. The federal withholding in box 6 shows up on 1040 line 25b with other 1099 withholding. Your Social Security might not be taxable.

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

Re: Social security tax

rjs — Fri, 30 May 2025 01:13:47 GMT

Social Security tax withheld from your pay, and shown in box 4 of your W-2, IS subject to federal income tax. You pay income tax on your gross pay (W-2 box 1), without subtracting Social Security tax (box 4) or Medicare tax (box 6). That's the way the tax rules work.

Re: Social security tax

Opus 17 — Fri, 30 May 2025 16:53:01 GMT

@rjs wrote:

Social Security tax withheld from your pay, and shown in box 4 of your W-2, IS subject to federal income tax. You pay income tax on your gross pay (W-2 box 1), without subtracting Social Security tax (box 4) or Medicare tax (box 6). That's the way the tax rules work.

Well, your social security tax is based on your box 3 income. Box 1 and box 3 income may be different in some cases, such as when you contribute to a 401k.

However, there are no tax deductions for paying social security tax, it is not a deductible tax like state income tax, sales tax, or real property tax.

Re: Social security tax

Jbob5 — Sun, 01 Jun 2025 13:13:49 GMT

Ok. That’s what I thought. Then 40 or 50 years later when the worker retires and starts drawing Social Security benefits and receives a 1099, at least part of that is taxed again, based on other income. Correct?

Re: Social security tax

xmasbaby0 — Sun, 01 Jun 2025 13:33:12 GMT

@Jbob5 Under the current tax laws, if you are receiving Social Security benefits AND have other taxable income, up to 85% of your Social Security can be taxable. If your ONLY income is Social Security, you do not need to file a tax return. We cannot predict what the tax laws will be even a year from now---and certainly cannot tell you what they will be in 40 or 50 years.

Re: Social security tax

NCperson — Sun, 01 Jun 2025 18:15:16 GMT

@Jbob5 yes, based on your other income, up to 85% of the social security income is subject to tax.

I would not necessarily think of it as "again". Think of it as the money you contributed to SS over the years was invested and the dividends / interest / earnings on those contributions are now part of your monthly SS payment you receive; you never paid tax on that portion. Technically, it is not invested, but think of it in that manner.