Taxpayers receiving Social Security benefits may have to pay federal income tax on a portion of those benefits. Social Security benefits include monthly retirement, survivor and disability benefits, but do not include supplemental security income payments (which are not taxable). The portion of benefits that are subject to tax depends on the taxpayer's income and filing status.
To find out if their Social Security benefits are taxable, taxpayers should first take one-half of the Social Security money they received for the year and add it to their other income (including any pensions, wages, interest, dividends and capital gains). If filing as single and that total comes to more than $25,000, then part of their Social Security benefits may be taxable. If married filing jointly, taxpayers should take half of their Social Security, plus half of their spouse's Social Security, and add that to all their combined income. If the total is more than $32,000, then part of their Social Security may be taxable.
50% of a taxpayer's benefits may be taxable if they are:
Filing single, head of household or qualifying widow or widower with $25,000 to $34,000 in income;
Married filing separately and lived apart from their spouse for all of 2019 with $25,000 to $34,000 in income; or
Married filing jointly with $32,000 to $44,000 in income.
Up to 85% of a taxpayer's benefits may be taxable if they are:
Filing single, head of household or qualifying widow or widower with more than $34,000 in income;
Married filing jointly with more than $44,000 in income;
Married filing separately and lived apart from their spouse for all of 2019 with more than $34,000 in income; or
Married filing separately and lived with their spouse at any time during 2019.
Taxpayers may also use the Interactive Tax Assistant on IRS.gov---Are My Social Security or Railroad Retirement Tier I Benefits Taxable?---to help determine whether their Social Security benefits are subject to tax.
For more information, see the following resources:
Tax Tip 2020-76 #IRSTaxTip