As we approach April 15, let’s discuss the federal taxation of your Social Security benefits. The Social Security Administration estimates that 40% of recipients pay income tax on their benefits. The taxable benefits include retirement and spousal, survivor, and disability (SSDI) benefits. , Keep in mind that if you have a child receiving benefits under their own Social Security number, they also may be subject to income tax. Benefits received under Supplemental Security Income (SSI) are not taxable.
Back in 1984, Social Security benefits became subject to income tax. Benefits received were made taxable in order to raise revenue in an effort to not cut benefits to people who were already receiving benefits. The major impetus for these many changes was to ensure Social Security’s solvency. We are quickly approaching the same solvency issue in 2034.
Support authors and subscribe to content
This is premium stuff. Subscribe to read the entire article.