Message Font: Serif | Sans-Serif
UnThreaded | Threaded | Whole Thread (6) | Ignore Thread Prev | Next
Author: TMFExRO Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 19741  
Subject: Re: Tax On Social Security Benefit Date: 3/28/2000 10:34 AM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
<< If I understand it right the IRS "handy-dandy" worksheet looks like if your AGI goes more than 25,000 (for a single) or 32,000 (for married) you begin to lose your social security benefit to taxes at an alarming rate. >>

I don't think you're reading the worksheet correctly. Remember that the bottom line of the worksheet is not tax, it's the amount of SS benefits you include in your income.

Let's say you were in the top tax bracket, 39.6%. (This applies on a joint return only for TAXABLE income above $271,050 for 1999.) You would pay tax on 85% of your Social Security benefits. Thus, at a maximum, 33.6% (39.6% of 85%) of your Social Security benefits would go back to the Federal government in the form of income tax on them. Hardly alarming for a household with almost $300,000 income.

Of course, most SS recipients who take a part-time job would end up paying far less a percentage of their benefit in income tax.

Phil Marti
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (6) | Ignore Thread Prev | Next


Post of the Day:
Saul's Investing Discussions

How to Deal With Investing Emotions
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.