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Are Social Security Benefits Taxable?
Date Updated: July 26, 2024
Written by:
With over a decade of dedicated experience, Andrea Miller boasts an extensive background in healthcare writing and editing. Her expertise spans various facets of the healthcare industry, with a particular focus on nursing, senior care, Alzheimer’s disease, and public health. Andrea has also contributed her editorial talents to reputable publishers in the Philadelphia region, complementing her extensive freelance work.
Your Social Security benefits may be taxable depending on your total income and filing status. The Internal Revenue Service uses a formula to determine the taxable portion of Social Security benefits. The calculation includes your adjusted gross income, nontaxable interest and half of your Social Security benefits. According to the Social Security Administration, about 40% of people who receive benefits pay taxes on the money.
Who pays taxes on Social Security benefits?
The SSA notes that you may have to pay federal income tax on all or part of your Social Security benefits if:
- You have significant income beyond your Social Security benefits, including wages, interest, dividends and self-employment income
- You file an individual tax return and have a combined income of more than $25,000
- You file a joint return and share a combined income with your spouse of more than $34,000
- You are married but file as a separate taxpayer
The SSA defines combined income as the total of 50% of your Social Security benefit amount plus your adjusted gross income and nontaxable interest.
How do I pay taxes on Social Security benefits?
You can pay taxes on Social Security income as a lump sum when you file your federal income tax return. You can also submit IRS Form W-4 to the SSA to request income tax withholding. With this arrangement, the SSA will hold back a portion of your monthly check to cover the estimated taxes you’ll owe for the year.