topic Re: Social Security... in Among Friends

Social Security...

Mom2Dogs — Wed, 25 Jan 2017 23:28:52 GMT

Does anyone know if Social Security is considered earned income?

Thanks.

Re: Social Security...

Apple Crisp — Wed, 25 Jan 2017 23:30:42 GMT

No, it is not.

Re: Social Security...

mac116 — Wed, 25 Jan 2017 23:38:30 GMT

I do have taxes withheld from my SS checks. Some of my friends do not use that option, and pay taxes on those benefits. It depends on your total income as I understand it. I certainly could be wrong...we have an accountant do our taxes.

Re: Social Security...

Mom2Dogs — Wed, 25 Jan 2017 23:41:56 GMT

I ask because I usually take out an IRA but this year/2017...I will not have any earned income except social security mid year....business is in my husands name and I am not a paid employee.

Re: Social Security...

Tinkrbl44 — Wed, 25 Jan 2017 23:42:12 GMT

I think it also depends on your age. If you retire early, it might be taxable income. Check with your tax advisor.

Re: Social Security...

Apple Crisp — Wed, 25 Jan 2017 23:44:07 GMT

Depending upon your income, you may have to pay taxes on a portion of your social security, but it is not considered earned income. When you file your income tax, social security benefits have a separate line on the tax form and the instructions explain how to determine how much, if any, tax you need to pay.

Re: Social Security...

Annabellethecat66 — Wed, 25 Jan 2017 23:44:46 GMT

Here it is for sure, no guessing:https://faq.ssa.gov/link/portal/34011/34019/article/3831/must-i-pay-taxes-on-social-security-benefits

Must I pay taxes on Social Security benefits?

Some people who get Social Security must pay federal income taxes on their benefits. But, no one pays taxes on more than 85 percent of their Social Security benefits.

You must pay taxes on your benefits if you file a federal tax return as an “individual” and your “combined income” exceeds $25,000. If you file a joint return, you must pay taxes if you and your spouse have “combined income” of more than $32,000. If you are married and file a separate return, you probably will have to pay taxes on your benefits.

See Benefits Planner: Income Taxes and Your Social Security Benefits for more information.

NOTE: “Combined income” includes your adjusted gross income, tax-exempt interest income and half of your Social Security benefits.

I hope this helps. I received $32,000 and it was for only part of the year because I waited til I was 70 to get it.

Re: Social Security...

Kachina624 — Wed, 25 Jan 2017 23:48:04 GMT

https://www.irs.gov/credits-deductions/individuals/earned-income-tax-credit/earned-income

Re: Social Security...

Annabellethecat66 — Wed, 25 Jan 2017 23:49:42 GMT

It's just crazy that anyone should have to pay taxes on any Social Security. Our money is taxed to death. It's just crazy!

Re: Social Security...

de1rdre — Wed, 25 Jan 2017 23:51:03 GMT

Social Security benefits do not constitute earned income, and as such do not serve as the basis for making IRA contributions.

They may or may not be taxable depending on the total amount of Social Security benefits and other income received during the year.

Re: Social Security...

Mom2Dogs — Wed, 25 Jan 2017 23:57:37 GMT

@de1rdre wrote:
Social Security benefits do not constitute earned income, and as such do not serve as the basis for making IRA contributions.

They may or may not be taxable depending on the total amount of Social Security benefits and other income received during the year.

Well fudge....we need that tax deduction we have been getting for the IRA

Re: Social Security...

NicksmomESQ — Thu, 26 Jan 2017 00:00:38 GMT

Social security is considered unearned income.However,depending on your overall net income you may owe taxes on it.

Re: Social Security...

151949 — Thu, 26 Jan 2017 00:08:48 GMT

@Annabellethecat66 wrote:
It's just crazy that anyone should have to pay taxes on any Social Security. Our money is taxed to death. It's just crazy!

First of all - in comparrison to other modern countries we pay very low taxes in the USA. Very few people who are on SS actually pay taxes on their income as the first 32,000 for a couple is not taxed and even if you both got the max amount it only comes to less than $60,000 a year. I don't know any one where both of the couple get the max amount. My DH gets the max and I get considerably less - by the time we deduct our personal deductions our total income is under the 32,000 so we pay no taxes. We don't even have to do a long form - just the short 1040A.In actual fact - we aren't required to file at all or to pay anything in thru the year but we do just to be safe.We get back every cent we pay in.

Re: Social Security...

Mom2Dogs — Thu, 26 Jan 2017 00:32:46 GMT

@151949....we are self employed and want to take as many deductions allowed by law.....that was the purpose of my question...I am not considered an employee as of this year but still work.

Re: Social Security...

SeaMaiden — Thu, 26 Jan 2017 00:37:55 GMT

@Annabellethecat66 wrote:
It's just crazy that anyone should have to pay taxes on any Social Security. Our money is taxed to death. It's just crazy!

@Annabellethecat66 I agree totally.

Re: Social Security...

millieshops — Thu, 26 Jan 2017 00:48:27 GMT

@Mom2DogsI'm not a professional, but I'd bet you big money yhat you can't use your SS income as the basis for an IRA.

The good news is that if you're already SS age, it's really not that long until you have to start taking distributions and many financial planners would advise you not to put more money into IRA's now.

Re: Social Security...

Mom2Dogs — Thu, 26 Jan 2017 00:56:13 GMT

@millieshops....I am taking SS early, 62 years....mainly because of my oh so high medical premiums.

We have a meeting with our financial advisor in a few weeks and I have made a list of questions, but would love to find something to replace the tax deduction we have been getting for my IRA contributions.

Re: Social Security...

Annabellethecat66 — Thu, 26 Jan 2017 01:29:10 GMT

My accountant and my stock broker both told me I have to start taking my IRA money this year. Ugh! I guess they'll tell me where to put it or what to do with it. Doesn't make sense to me.

Re: Social Security...

Mom2Dogs — Thu, 26 Jan 2017 01:44:00 GMT

@Annabellethecat66...you have reached that magic age when you must start to take your IRA's.

Mh DH is older than I am and he has been taking distrubutions for a couple of years...we just pay the taxes and reinvest the money. Since we are still working we don't want the money, so we save it.

Re: Social Security...

proudlyfromNJ — Thu, 26 Jan 2017 01:46:28 GMT

@Annabellethecat66. Everyone has to take it at 70. You can do whatever you want with it.