receiving social security at 62, is there increased tax liabilities

[2011lkm]

I would like to know if my circumstance will put us at a penalty or increased tax bracket or federal tax liabilities:  I am 62 1/2 and receive a pension, work a small part time job and just began receiving social security income.  I am married and my husband is 65 and still working.  Should I expect a big tax bill at the end of the year and what should I be doing now to prepare?

[conniem123]

Hi 2011lkm,

Congratulations on your semi-retirement!  Of course, that comes with tax planning too!

A portion of your social security MAY be taxable, it depends on the amount of your other income.  If you earn between $32,000 and $44,000 per year as married filing jointly, you will pay income taxes on up to 50% of your Social Security benefits. If you earn more than $44,000, you’ll pay taxes on up to 85% of your benefits. You will never be taxed on more than 85% of your Social Security benefits.

Here is a great resource with an example for you to calculate using your income figures, https://www.ssa.gov/benefits/retirement/planner/taxes.html#:~:text=between%20%2425%2C000%20and%20%24....

If you determine you will have some of your social security income taxable, you can

1) elect to have federal tax withheld from your social security income, https://www.ssa.gov/manage-benefits/request-withhold-taxes#:~:text=You%20will%20pay%20federal%20inco.... or 2)  increase the withholdings from either you or your husband employments, or

3) make an estimated tax payment, or

4) set aside money.

I hope you find this helpful!

Connie