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Whose Social Security checks get taxed?
Maurie Backman explains income taxes on Social Security benefits here. If Social Security is your sole source of retirement income, you’ll likely keep full monthly benefits. It’s when outside income gets thrown into the mix that taxes on benefits start to apply. Taxes come into play at pretty low income thresholds but are based on a specific type of income– combined or provisional income, which is calculated as 50% of the amount of Social Security you receive each year plus additional income that must be reported on your return.
For single tax-filers, a combined income of $25k-34k leaves you subject to taxes on up to 50% of your Social Security benefits. Once your combined income exceeds $34k you risk taxes on up to 85% of your benefits. If married filing jointly, a combined income of $32k-44k leaves you subject to taxes on up to 50% of your benefits. Beyond $44k up to 85% of your Social Security may be taxed. Full piece here.
The AMAC Foundation offers a free-to-the-public advisory service to all folks ageing into–or already in–Social Security. This service provides guidance in understanding the complexities of Social Security and the myriad rules and regulations associated with the process for claiming benefits, with NSSA-Certified Social Security Advisors available via email or telephone to discuss options. Learn more about this service via the Foundation’s website.