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New Member
posted Jul 29, 2024 1:36:18 PM

Should I continue voluntarily have taxes deducted from my SS income i.e. is it to my advantage to continue the voluntary tax deduction?

income will only come from federal pension and SS benefits, is it advantageous to continue voluntary tax deductions?

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2 Best answers
Level 15
Jul 29, 2024 1:53:36 PM

The key word is "withholding."  You want to have enough taxes withheld from the SS benefit, pension, or both, to cover most of your tax bill.  The alternative is to make quarterly estimated payments.  This is ok, but if you miss one, you can be assessed an under-payment penalty even if you pay in full when you file your return.  If you have too much withheld, it comes back as a tax refund, of course.

Level 15
Jul 29, 2024 2:30:54 PM

Depends if any of your SS will 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

 

3 Replies
Level 15
Jul 29, 2024 1:40:49 PM

Withholding should account for the tax you anticipate paying. It makes no difference where the withholding comes from. 

Level 15
Jul 29, 2024 1:53:36 PM

The key word is "withholding."  You want to have enough taxes withheld from the SS benefit, pension, or both, to cover most of your tax bill.  The alternative is to make quarterly estimated payments.  This is ok, but if you miss one, you can be assessed an under-payment penalty even if you pay in full when you file your return.  If you have too much withheld, it comes back as a tax refund, of course.

Level 15
Jul 29, 2024 2:30:54 PM

Depends if any of your SS will 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