Chicago News and Media

Social Security Benefits Taxable After Age 65

At 65 to 67, depending on the year of your birth, you are at full retirement age and can get full Social Security retirement benefits tax-free. However, if you’re still working, part of your benefits might be subject to taxation. The IRS adds the figures for your earnings and half your Social Security benefits. If the total exceeds the Internal Revenue Service’s income limits, your benefits will be taxed.

Taxation for Individuals

If you’re filing your tax return as an individual and your combined income tops $25,000 per year, the IRS taxes 50 percent of your Social Security benefits. Up to 85 percent of your benefits are taxed if your total annual income is more than $34,000.

Taxation for Married Couples

If you’re married, your spouse’s earnings are calculated as part of your total annual income for tax purposes. This means that even if you’re not working or making a substantial amount at your job, your spouse’s income can affect your Social Security benefits. As of 2012, if your annual combined income tops $32,000, up to 50 percent of your Social Security benefits are taxed. If the total household income surpasses $44,000 per year, up to 85 percent of your benefits are taxed.

If you’re required to pay taxes on your Social Security benefits, you have several ways to do so. You can pay it all by the tax-due date, usually April 15. You can make estimated tax payments throughout the year to the IRS. Another option is to ask the Social Security Administration to withhold taxes from your monthly benefit checks. Social Security benefits are subject only to federal income taxes.

Read the rest of this story from where it originally appeared (with videos) 

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