Q: Do I need to pay federal income taxes on monies that I received throughout the year from the SSA?
A: Maybe. If you file as an “individual” and your combined income exceeds $25,000.00, or if you and your spouse file a joint return and your combined income exceeds $32,000.00, then you will need to pay federal taxes on a portion of those benefits.
Q: Am I taxed on the whole amount that I received?
A: No. If you file as an “individual” and your combined income for the year is between $25,000.00 and $34,000.00, you are likely only going to be taxed on up to 50% of the total benefits. However, if your combined income exceeds $34,000.00 for the year, then you may be looking at paying taxes on up to 85% of the benefits. If you file jointly with your spouse and your combined income is between $32,000.00 and $44,000.00, then you will likely pay taxes on 50% of the benefit income. If you file jointly and the combined income of you and your spouse is more than $44,000.00 then you will likely pay taxes on up to 85% of the benefits.
Q: How does my income from Social Security benefits factor into my overall combined income?
A: Your adjusted gross income is added to the non-taxable interest earned. From there, you add ½ of your Social Security benefits to achieve your total combined income.
Q: How do I know how much I have received in benefits from the Social Security Administration for the year?
A: In January of each year, the SSA will send you a 1099 to show the total amount paid during the previous year.
Q: What if I lost my 1099 or if I moved abroad?
A: You can create an online account by visiting the Social Security Administration’s website. Once the account is created and you are logged on, you can utilize the tab “Replacement Documents” to print out copies of any documents that you have misplaced or that you never received.
Q: Can I choose to have taxes withheld from my benefits to avoid paying a large amount at tax time?
A: Yes! You can submit form W-4V online. This is a voluntary withholding request that gets filed with the IRS. It can be modified or changed at a later date, if needed. Or, if you prefer, you can contact the IRS at 800-829-3676 and ask for assistance in setting up voluntary withholding.
Q: I need help! Who can help me?
A: A knowledgeable CPA and Christina Miller and Associates, of course!
