Are Your Social Security Benefits Taxable?

If you've recently begun receiving Social Security benefits or plan to apply in the near future, you may be wondering this tax season: are Social Security benefits taxable?

The short answer is: sometimes.

Some people have to pay federal income taxes on their Social Security benefits. This usually happens only if you have other substantial income (such as wages, self-employment, interest, dividends and other taxable income that must be reported on your tax return) in addition to your Social Security benefits.

There is never a case when a person pays tax on more than 85 percent of his or her Social Security benefits, based on Internal Revenue Service (IRS) rules.

Now, let's get down to the numbers.

If you file a federal tax return as an individual and your income is between $25,000 and $34,000, you may have to pay income tax on up to 50 percent of your benefits. If your income is more than $34,000, then up to 85 percent of your benefits may be taxable.

If you are married and you file a joint return, and you and your spouse have a combined income that is between $32,000 and $44,000, you may have to pay income tax on up to 50 percent of your benefits. If your combined income is more than $44,000, then up to 85 percent of your benefits may be taxable.

Note that your "income" for the purpose of determining whether you must pay taxes on some of your Social Security benefits includes your adjusted gross income, your nontaxable interest, and one half of your Social Security benefits.

In January, you should have received a Social Security Benefit Statement showing the amount of benefits you received last year. You can use this statement (SSA-1099) when you complete your federal income tax return to find out whether some of your benefits are subject to federal income tax. If you didn't receive yours, click here.

So, are your Social Security benefits taxable? Maybe. For more information, read page 14 of Retirement Benefits or visit www.irs.gov.

Contributor Kirk Larson is a public affairs specialist at Social Security Washington.

Need Help Preparing Your Tax Return?

If your household made $60,000 or less in 2014, you can have your taxes prepared for free by United Way of King County's Free Tax Campaign. Services are available at 25 locations across King County, now through April 18, 2015.

An IRS-certified tax prep volunteer can help you get all the credits you qualify for and file your return electronically, so you'll get your refund fast. No appointment needed and no fees to pay.

For a site near you, click here and enter your zip code. Simple as that!

For more info, read New Ways to Keep More of Your Hard-Earned Money (AgeWise King County, January 2015).