Depending on your filing status and income your Social Security Benefits may be taxable. Taxable Social Security Benefits include retirement, survivor, and disability benefits. Supplemental Security Income payments, SSI, are not taxable. The formula used to calculate if your income is high enough to cause your Social Security Benefits to be taxable is as follows: Add one-half of your Social Security Benefits to your other income. Pretty simple. But what is other income? Other income includes pensions, wages, interest, dividends, and capital gains. The threshold for Social Security Benefits being taxable is $25,000 on income for Single filers and $32,000 for married filers where half of each spouse’s Social Security Benefits are added to the couple’s other income.
If you meet the taxable threshold then how much of the Social Security Benefits are taxable? For single, head of household, qualifying widow or widower, or married filing separately and lived apart from their spouse for all of 2021 with $25,000 to $34,000 of income, and married filing jointly with $32,000 to $44,000 of income, 50% of your Social Security Benefits may be taxable.
For single, head of household, qualifying widow or widower, or married filing separately and lived apart from their spouse for all of 2021 with more than $34,000 of income, and married filing jointly with more than $44,000 of income, 85% of your Social Security Benefits may be taxable.
Please use these guidelines as a rule of thumb as the exact science of calculating the taxable taxability of Social Security Benefits may be more complex. If you think your Social Security Benefits may be taxable please contact your CPA or other tax professional.
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