I am surprised at the big change of federal taxes due after I add my SS benefit.
After entering income totaling $66,791.00 I owed $618.00 federal tax.
After adding $28,658.00 Social Security benefit my federal tax due is now $5,975.00.
I have reviewed various internet sites to find the answer for the big change but have
not found any good answers. Could the coding be wrong within turbo tax?
Up to 85% of Social Security is taxable depending on your other income and filing status. For the complete calculation, you can refer to the IRS worksheet, but for single filers, if half your Social Security plus your other income exceeds $34,000, 85% of your Social Security is taxable. 85% of your Social Security would be $24,359.
If your taxes went up $5,357 once you entered it, that would suggest a 22% tax rate, which is the rate for single filers with incomes from $40,526 to $86,375.
@billstesting [Edited 02/01/2022|5:15 AM PST]
Up to 85% of Social Security is taxable depending on your other income and filing status. For the complete calculation, you can refer to the IRS worksheet, but for single filers, if half your Social Security plus your other income exceeds $34,000, 85% of your Social Security is taxable. 85% of your Social Security would be $24,359.
If your taxes went up $5,357 once you entered it, that would suggest a 22% tax rate, which is the rate for single filers with incomes from $40,526 to $86,375.
@billstesting [Edited 02/01/2022|5:15 AM PST]
If your income will be the same next year you can have more withholding from the job and/or have withholding from the SS payment and/or make quarterly estimated payments so you don't end up in the same pickle next year.
You should not be surprised.
You should know that SS benefits are taxable.
Ask the SS administration to withhold some tax.