As Americans prepare their taxes, many who collect Social Security are unsure of whether benefits count as income or not.
Whether benefits count as income depends on how much of an income you have overall.
When retired individuals begin collecting their benefits, many work less so their income doesn’t go past a certain level.
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Paying taxes on Social Security
Beneficiaries will calculate their income by combining their benefits with any other taxable income they must claim.
Once they have the final amount, they will know whether they need to pay income taxes or not.
Income limits for Social Security and taxes
For single filers, if they make under $25,000 they normally won’t need to pay taxes on their benefits.
Married couples have a limit of $32,000.
Maximum 2022 benefit is $4,194
With a combined income between $25,000 and $34,000 the Social Security Administration can tax up to 50% of your benefits.
If your income goes beyond $34,000 for single filers or $44,000 for married filers, you can have up to 85% of your benefits taxed.
Filing for taxes on Social Security benefits
Every year the SSA will send a Form SSA-1099 detailing your benefits.
You can file your taxes with this form to see if you qualify for your benefits to be taxed.
If you worry about being surprised by a large tax bill at the end of the year, you’re able to report your income quarterly or have taxes withheld from your benefits.
To get your taxes withheld submit Form W-4V to the IRS.
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