Action Line: Employment income may make Social Security benefits taxable
BY PHIL MULKINS World Action Line Editor
Friday, March 15, 2013
3/15/13 at 4:49 AM
Dear Action Line: I started Social Security benefits last year and continued working. I want to know if my working income, with the benefits, are now taxable. - R.T., Tulsa
If you drew Social Security benefits and continued working in 2012, you might have to pay taxes on your Social Security benefits, according to the Internal Revenue Service website.
Form SSA-1099: You should also have begun receiving the form "Social Security Benefit Statement," by early February 2013. It shows the amount of benefits you received in 2012. If you did not receive it by early this month, request it online at tulsaworld.com/IRSFormSSA1099
The IRS website offers tips to help you determine whether your benefits are taxable. The amount of your income and your filing status affect your need to pay taxes on Social Security benefits. If Social Security was your only income in 2012, your benefits are probably not taxable. You also might not need to file a federal income tax return.
Half of SS: Determine whether your benefits are taxable by adding one-half of your Social Security benefits to all your other income, including tax-exempt interest (tax-exempt interest includes interest from state and municipal bonds). Compare this total to the three base amounts for filing statuses. If the total is more than your base amount, some of your benefits might be taxable.
$25,000: This is the most annual income that a filer - single, head of household, qualifying widow or widower with a dependent child or married individuals filing separately who did not live with their spouse at any time during the year - can earn before benefits are taxed.
$32,000: This is the maximum for married couples filing jointly.
$0: This is the figure for married persons filing separately who lived together at any time during the year.
E-file: If you use IRS e-file to prepare and file your tax return, the tax software will figure your taxable benefits for you. If you file a paper return, you can use the Interactive Tax Assistant tool ( tulsaworld.com/IRSInteractiveTaxAssistant) to determine taxability of your benefits. The ITA is a resource that can help answer most tax law questions.
There also is a worksheet in the "Instructions for Form 1040" ( tulsaworld.com/IRSForm1040i) you can use to figure your taxable benefits.
Pub 915: For more information on the taxability of Social Security benefits, see IRS "Publication 915, Social Security and Equivalent Railroad Retirement Benefits" at tulsaworld.com/IRSPub915 Or get a copy by calling 800-829-3676.
IRS YouTube videos: Watch "Is Social Security taxable" in English at tulsaworld.com/IRSUTubeSStaxEng or in Spanish at tulsaworld.com/IRSUTubeSStaxSpn
Original Print Headline: Employment income may make Social Security benefits taxable
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