6-23-10 Social Security Benefits - Some things you should know

Social Security Benefits – Some things you should know

There are several rules regarding taxability for Social Security benefits. If you receive Social Security benefits, here are some facts to consider:

• The amount of your benefits that is taxable depends upon marital status and total income.

• If you only receive Social Security benefits with no other income, you likely do not have to file a tax return.

• If you have other income besides Social Security benefits, your modified adjusted gross income must be less than your base amount in order to avoid being taxed on your benefits. Modified adjusted gross income is generally your total gross income for the year.

• In 2009, the base amounts were:

o $32,000 if you are married filing jointly
o $25,000 for single, head of household or married filing separately if you did not live with your spouse throughout the tax year
o $0 for those married filing separately that did live with their spouse during the tax year

• To determine if some of the Social Security benefits are taxable would be to:

o To add one-half of your benefits to all of your other income
o Then compare this total to the base amount for your filing status and if the total is more than the base amount, then
some of the benefits are taxable

To assist you in determining the amount of benefits that are taxable, please do not hesitate to contact us.
 
 
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