How do i calculate how much of my social security income is taxable

Did you know that up to 85% of your Social Security benefits may be subject to income tax? If this is your situation, you may want to consider repositioning some of your other income to minimize how much of your Social Security benefit may be taxed and thereby, maximize your retirement income sources. Use our Social Security tax calculator to better calculate your Social Security benefits.

How Much Do You Get for Social Security Retirement?

How much you get for Social Security retirement benefits will depend on a number of factors, including your income, how long you worked and when you retired. One thing you’ll need to consider when getting your retirement benefits or when planning for Social Security retirement is that it may be taxed.

If you have a combined income but are filing as an individual, your benefits aren’t taxed if your benefits are below $25,000. If your income is above that but is below $34,000, up to half of your benefits may be taxable. For incomes of over $34,000, up to 85% of your retirement benefits may be taxed.

For the purposes of taxation, your combined income is defined as the total of your adjusted gross income plus half of your Social Security benefits plus nontaxable interest. Other wages that may be applied to this include self-employment income, wages, capital gains and dividends or other investment income from interest, annuities, pensions, rental property profits, municipal bond interest and withdrawals from retirement accounts such as IRAs, 403(b) and 401(k) accounts. Roth IRA withdrawals don’t count toward combined income.

You can use the Money Help Center calculator to determine how much Social Security you will get and how income tax may impact your benefits and income. You need to plan for retirement by considering how you will be taxed once your working life ends. You don’t want to get an unpleasant surprise when you start earning your retirement income or getting your benefits and realize it is less than you expected because of tax withdrawals.

At the same time, Social Security can be a smart part of your retirement plan. Even if you are taxed at the highest level, you may still benefit. After all, from virtually any other source of income, 100% of your wages and income will be taxed after retirement. Dollar for dollar, Social Security retirement benefits can still be a better deal as far as taxation, than other sources of retirement.

As you plan for your golden years, it is important to keep in mind all the sources of income you may have once you finish working. Plan ahead and consider the tax impact on your income as well as any tax advantages you can secure today while saving for retirement. Use the Money Help Center calculators to help you plan. Our calculators are free, have no bias and never ask you for your personal information, such as contact information or e-mail address. You can use them at any time and instantly get information to help you plan for your financial future.

Up to 50% or even 85% of your Social security benefits are taxable if your “provisional” or total income, as defined by tax law, is above a certain base amount. Your Social Security income may not be taxable at all if your total income is below the base amount.

If you’re married and filing jointly with your spouse, your combined incomes and social security benefits are used to figure your total income.

When Is Social Security Income Taxable?

To determine when Social Security income is taxable, you’ll first need to calculate your total income. Generally, the formula for total income for this purpose is: your adjusted gross income, including any nontaxable interest, plus half of your Social Security benefits.

If you’re married and filing jointly with your spouse, your combined incomes and social security benefits are used to figure your total income.

Then you’ll compare your total income with the base amounts for your filing status to find out how much of your Social Security income is taxable, if any.

You’ll see that you fall into one of three categories. If your total income is:

• Below the base amount, your Social Security benefits are not taxable.
• Between the base and maximum amount, your Social Security income is taxable up to 50%.
• Above the maximum amount, your Social Security benefits are taxable up to 85%.

How Much of Your Social Security Income is Taxable?

Review the list below to determine where your total income falls and how much of your Social Security income is taxable. For:

• Single, Head of Household or Qualifying Widow(er), the base amount is $25,000 and the maximum is $34,000.
• Married filing jointly, the base amount is $32,000 and the maximum is $44,000.
• Married filing separately, the base amount is $0 and the maximum is $0. (Note: married filing separate filers who lived apart the entire tax year use the same base and maximum amounts as single filers.)

Are All Kinds of Social Security Income Taxable?

All social security benefits are taxable in the same way. This is true whether they’re retirement, survivors, or disability benefits. Take note that Social Security benefits paid to a child under his or her Social Security number (SSN) could be potentially taxable to the child, not the parent. Note: Supplemental Security Income, or SSI, is a non-taxable needs-based federal benefit. It is not part of Social Security benefits and does not figure into the taxable benefit formula.

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