Why Is My Social Security Taxed?

If you receive Social Security benefits, you may have to pay federal income tax on part of your benefits. These IRS tips will help you determine whether or not you need to pay taxes on your benefits.

  • Form SSA-1099.  If you received Social Security in 2014, you should receive a Form SSA-1099, Social Security Benefit Statement, showing the amount of your benefits.
  • Only Social Security.  If Social Security was your only income in 2014, your benefits may not be taxable. You also may not need to file a federal income tax return. If you get income from other sources such as part-time jobs, dividends, or interest you may have to pay taxes on some of your benefits.
  • Tax Formula.  Here’s a quick way to find out if you must pay taxes on your Social Security benefits: Add one-half of your Social Security to all your other income, including tax-exempt interest. Then compare the total to the base amount for your filing status. If your total is more than the base amount, some of your benefits may be taxable.
  • Base Amounts.  The three base amounts are:
    • $25,000 – if you are single, head of household, qualifying widow or widower with a dependent child or married filing separately and lived apart from your spouse for all of 2014.
    • $32,000 – if you are married filing jointly.
    • $0 – if you are married filing separately and lived with your spouse at any time during the year.

 

Disclosure

We inform you that any tax advice provided or implied on this post (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of avoiding penalties that may be imposed on the taxpayer.

While the information contained in this post is believed to be reliable, we cannot guarantee its accuracy or completeness.

Report Name Change before You File Taxes

People change their name for a variety of reasons: marriage, divorce, re-marriage, adoption, et cetera. Did you change your name last year? Did a dependent have a name change? If the answer to either question is yes, be sure to notify the Social Security Administration (SSA) before you file your tax return with the IRS.

This is very important because the name on your tax return must match SSA records. If the names do not match, you are likely to get a letter from the IRS about the mismatch. A mismatch will very probably delay any refund that you were expecting.

Be sure to contact SSA if:

  • You got married or divorced and you changed your name.
  • A dependent you claim had a name change. For example, this would apply if you adopted a child and that child’s last name changed.

File Form SS-5, Application for a Social Security Card, with the SSA to let them know about a name change. You can get the form on SSA.gov, by calling 800-772-1213, or at an SSA office.

You can file Form SS-5 at an SSA office or by mail. Your new card will have the same SSN as before but will show your new name.

 

IRS Circular 230 Disclosure

Pursuant to IRS Regulations, we inform you that any tax advice provided or implied on this post (including attachments) is not intended or written to be used, and cannot be used, for the purpose of avoiding penalties that may be imposed on the taxpayer.

While the information contained in this post is believed to be reliable, we cannot guarantee its accuracy or completeness.