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About Taxation of Social Security Disability Benefits - TickerTV News
Are Social Security Disability Insurance (SSDI) benefits subject to income tax? It’s a question regularly asked of the AMAC Foundation’s Social Security Advisory Service and, as with many questions about Social Security, the answer is “it depends.” There are nuances to almost all Social Security rules, but this one is actually an IRS question – after all, it is the IRS, not the Social Security Administration, which administers the nation’s income tax program.
Social Security Disability benefits may, or may not be subject to taxation by the IRS. If the SSDI recipient’s only income is SSDI, then those benefits are likely not taxable. But if the SSDI beneficiary has significant other income – for example, from investments, interest, dividends, sale of property, etc. – then SSDI benefits will likely be taxable. You see, there is an income threshold at which Social Security benefits become taxable, and the threshold is different depending on your tax filing status (single or married).
This article appearing at TickerTV News provides an outline of Social Security Disability, including what it is and how it works, and explains that SSDI benefits are, indeed, taxable under certain circumstances. The article also indicates that another government benefit known as “SSI” (Supplemental Security Income) is not taxable, but don’t confuse SSI with SSDI – they are different benefit types each with their own rules.
In a nutshell, SSDI benefits are taxed if the recipients combined income from all sources as a single income tax filer is more than $25,000, or more than $32,000 as one who files as “married/jointly.” The portion of SSDI benefits which will be taxed by the IRS is between 50% and 85% of SSDI benefits received, depending on total combined income (which includes half of SSDI benefits received during the tax year).
Click here to read the TickerTV News article about taxation of SSDI benefits and, if you have additional questions, contact the AMAC Foundation’s Social Security Advisor Service at 1.888.750.2622, or via email to SSAdvisor@amacfoundation.org. There is never a fee for the AMAC Foundation’s advisory service. Learn more about it here…