Are Social Security Benefits Taxable?

Individual income tax returns for 2015 are due by April 18, 2016. The IRS filing deadline is usually April 15, but this year’s deadline has been pushed to the following Monday because April 15 is a legal holiday.  income tax

A portion of your Social Security benefits may be taxable depending on the amount of benefits you received, other income, and your filing status.

To quickly determine if your Social Security benefits may be taxable, follow these steps:

  • Look at your Form SSA-1099 which shows the amount of benefits you received.
  • To determine your total taxable income, take one-half of the total benefits from Form SSA-1099, add any other income you received in 2015, which could include the following, among other things: interest income, pensions, wages, ordinary dividends, some IRA distributions, and capital gain distributions (also include any tax-exempt interest income). If you plan to file a joint income tax return, include your spouse’s benefits and income.
  • Compare the total amount from step 2 to the base amount for your filing status. If you are single, head of household, qualifying widow(er), or married filing separately, the base amount is $25,000. If you are married and filing jointly, the base amount is $32,000.
  • If the total from step 2 is more than the base amount in step 3, some of your benefits may be taxable. Even if none of your benefits are taxable, if your total taxable income for 2015 exceeds the minimum filing requirement amount for your filing status, a return must be filed. Some of the minimum filing requirements are: single and under 65 (at the end of 2015): $10,300; single and 65 or older: $11,850; married filing jointly and both spouses are 65 or older: $23,100.

There are, of course, many exceptions that could alter the above determination. For example, if one-half of your benefits and all other income is more than $34,000 ($44,000 if you are married and filing jointly), then 85% of your benefits may be taxable instead of 50% of your benefits.

IRS Publication 915 is a good source and guide for Social Security benefits and determining whether benefits are taxable. Included in the publication is a worksheet that can be helpful in determining any tax liability. It can be found at: https://www.irs.gov/pub/irs-pdf/p915.pdf .

If you are unsure or have any questions regarding your possible tax liability for 2015, consult a tax professional as soon as possible.

Contact an Elder Law Attorney Today

To learn more about the ways that an experienced Lakeland, FL elder law attorney can assist you, give us a call at 863-288-0904 or contact us online. We are ready to help you create a comprehensive plan in case of incapacity or death, as well as to plan how you can achieve your goals and protect your assets in the future.

About Julianne D. Ware