by AMAC Certified Social Security Advisor Russell Gloor Association of Mature American Citizens Ask Rusty - “About income tax on Social Security Benefits” Dear Rusty: I just started receiving my Social Security in February of 2023. I am also working part time at a company 24 hours a week. My question is... I feel like I missed something when I signed up for Social Security because they are not taking any taxes out. What did I miss? How do I go about fixing it so I don’t get hit at the end of the year? They are taking taxes out of my paycheck now, do they still take it out of my Social Security because I am working? Please help if I am not doing something right. Signed: Conscientious Senior Dear Conscientious: Unfortunately, when the Social Security Administration processes your application for benefits, they don’t usually inform you that your Social Security benefits may become part of your taxable income. I expect that’s because your benefits only “may” become taxable – they do not definitely become taxable, because Social Security benefits are taxed only if you exceed a certain income threshold.The thresholds at which Social Security benefits become part of your taxable income are different depending on your income tax filing status – those who file as an individual have a different threshold from those who file as “married – filing jointly.” And to further complicate matters there is more than one threshold for both individuals and joint filers. Here’s how it works: If you file your income tax as an individual and your “combined income” from all sources is more than $25,000, then 50% of the Social Security benefits you received during the tax year becomes part of your overall taxable income at your particular IRS tax rate. But if your combined income as an individual tax filer is more than $34,000 then up to 85% of the SS benefits you received during the tax becomes part of your overall taxable income.If your income tax filing status is “married – filing jointly” the thresholds are higher – if your combined income from all sources as a married couple exceeds $32,000 then 50% of the Social Security benefits you received during the tax year becomes part of your taxable income. But if your combined income as a married couple exceeds $44,000 then up to 85% of your SS benefits received ...
