filing jointly or separately

[mmusmanno]

I started collecting social security this year and now my wife has a job offer for over $100,000.  since this salary is over the limit for social security benefits income.  my question is do we file separately now since her income will put us over the ssa benefit limit if we file jointly?  or does her income not count toward my income regarding ssa benefits?

[VolvoGirl]

How old are you?  If you reached full retirement age your other income doesn’t matter, at least for your SS checks.

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

And see,

https://www.ssa.gov/pubs/EN-05-10069.pdf

And see the special first year rule

KA-01927

And Benefits Planner: Retirement | Special Earnings Limit Rule | SSA

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

[guywong]

Your wife's earned income has nothing to do with your social security benefits.  If your wife is under her full retirement age, then she can only have no more than $1,860 or so in earned income per month or 45 hours of self-employed work in order to keep her social security benefits.  But you can collect your regular benefits as only as you don't earn more the $1860/mo or work for more than 45 hours.   Whether you two file separately or jointly is irrelevant.  You are correct that "her income [does] not count toward my income regarding ssa benefits."

[NCPERSON1]

@mmusmanno as other have stated, 

the 'clawback' only occurs if YOU are under your Full Retirement Age (FRA) and only is determined based on YOUR EARNED Income.  Your spouse's EARNED income has no baring on this.

Separately, if you were to file SEPARATE and you live with your spouse, 85% of your SS would AUTOMATICALLY be subject to income tax.  a Very Bad Deal! 

[xmasbaby0]

Your spouse's income has no effect on the amount of your Social Security benefits.  If you continue to work before full retirement age while receiving SS benefits, your benefits can be reduced.  But your benefits are not reduced by your spouse's income.

Her income will affect how much of your SS is taxable when you file your joint tax return.   And...  you should file jointly.    If you file separate returns with the mistaken idea that your SS will not be taxable, it will be an unpleasant shock to you that 85% of your SS is taxable if you file separately.

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 2021 it was  $18,960.  For 2022 it was  $19,560  —  for 2023 $21,240)  For 2024, $22,320.  For 2025 it will be $23,400

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.  If you work as an independent contractor then you will pay self-employment tax for Social Security and Medicare.

To see how much of your Social Security was taxable, look at lines 6a and 6b of your 2024 Form 1040

https://www.irs.gov/help/ita/are-my-social-security-or-railroad-retirement-tier-i-benefits-taxable

You need to file a federal return if half your Social Security plus your other income is

Single or Head of Household      $25,000

Married Filing Jointly                  $32,000

Married Filing Separately            $0

Some additional information:  There are 9 states that tax Social Security—Colorado, Connecticut,, Minnesota, Montana, New Mexico, Rhode Island, Utah, Vermont  and West Virginia These states offer varying degrees of income exemptions, but two mirror the federal tax schedule: MN and VT.