Can we defer this income any way into next year?

[mnharrell]

My husband started receiving SS checks while working in Jan 2017.  I also have unexpected income through personal contracts. Can we defer this income any way into next year? My husband will retire Jan. 1, so our income is about to drop drastically.

[xmasbaby0 · Accepted solution]

No, you cannot "defer" income you receive in 2017 to 2018.  If you receive the money in 2017, it goes on your 2017 tax return.

TAX ON SOCIAL SECURITY

Up to 85% of your Social Security benefits can be taxable.  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)  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.

To see how much of your Social Security was taxable, look at line 14b of your 1040A, or line 20b of your 1040

https://ttlc.intuit.com/questions/1899144-is-my-social-security-income-taxable

[VolvoGirl]

Couple things.....Can you or him make any Traditional IRA contributions?  It sounds like your income will be self employment income.  You need to file a schedule C for it and pay self employment tax on it.  Do you have any expenses you can write off for it?  Maybe you can put most of your self employment income into a IRA or SEP IRA or a retirement plan.

[mnharrell]

My husband just opened an account and is having his next few checks put into it.  I have not thought about filing as self employed because each contract included a W2 and they deducted taxes.  Can I file self employed even though they use a W2?  The only expenses I can think of would be the use of my home office.

[Zbucklyo]

You are not self-employed, if you are treated as an employee, and receive W-2s.