Do Seniors Pay Taxes On Social Security Income?
A lot of people who are preparing for retirement, or have retired are asking the question “do seniors pay taxes on social security income?” or “do senior citizens have to file taxes?”. Understanding tax laws for seniors is an important issue whether it’s you retiring or a loved one. Whether you have to pay taxes while on social security varies from situation to situation.
When Seniors Must File Taxes On Social Security
The Internal Revenue System requires taxes to be file for individuals where their gross income exceeds the standard deduction for their specific filing status, adding 1 exemption amount. These tax laws include seniors receiving social security.
Do You Count Social Security Toward Gross Income?
Social security is not added into calculations for gross income. This means that the only income that must be considered for taxation is income aside from your social security benefit.
If All I Get Is Social Security Do I File A Tax Return?
If a senior’s only source of income is their social security it is no necessary to file a tax return. This saves seniors and the federal government time and the trouble of going through unnecessary paperwork.
Does Social Security Become Taxable When Filing Joint Taxes?
For seniors who are over 65 which have a combined income of over 23,100 must file income taxes. If one of you that files jointly is under 65 the limit is $21,850. Add up the total income including the social security benefits and if it is over these amounts, file taxes for that year.
Taxable Percentages Of Social Security Benefits
The amount of your social security taxes will be calculated on depends on your situation. If you are filing as an individual, jointly, or married and filing separately. The percentage you’ll pay varies from 50% to 85%.
Taxable SS For Individuals
For seniors who file taxes individually the percentage of your social security income that is taxable depends on your income. For seniors who make below $34,000 the percentage is 50% of the income that will be taxable. For seniors who make over $34,000 the percentage is 85%.
Taxable SS For Joint File
For seniors who are married or file jointly the limits are higher to accommodate more income. For couples filing that make less than $44,000 the percentage that is taxable is 50%. If your joint income is over $44,000 your taxes will be based on 85% of your social security income.
Easy Combined Income Tax Calculation
To calculate your adjusted gross income or AGI you will need to add your non-taxable interest to 50% of your social security benefits to get your combined income. This is if your income is under the two cut offs of $34k and $44k based on your individual situation.
Senior Tax Credits
Even if you need to file your taxes due to your own source of income in addition to social security there are ways to lower the taxes you’ll need to pay. If you’re over 65 or have additional sources of income past social security you might be able to use the senior tax credit. This tax credit lowers the taxes you’ll need to pay on combined income. Individuals that owe money to the IRS are not eligible to receive the senior tax credit.
Senior Living Services
If you’re a senior and are looking to maximize your budget and get the best housing and care available, SLS Communities can help. Seniors typically have limited income or are smart with their money and want the best living conditions available. SLS Communities provides full services for senior living including: independent living, assisted living, memory care, and home care. No matter what your needs are our team has a way to accommodate you with a tailored approach that is as compassionate as it is professional. If you’d like to experience the best senior living services please call 480-348-0300.