3 Replies Latest reply on Apr 20, 2012 1:56 PM by JerryD

    Social Security and paying taxes

      I am still working and also collecting what I qualify for from ex-spouses Social Security. Do I have to pay taxes on those Social Security payments? I'm 66 and make more than $38,880. I was told that I did not have to pay taxes, but am wondering if that's correct.
      For that matter, is Social Security taxed at all?
      Nana5
       
        • Re: Social Security and paying taxes
          JerryD
          You bet that SS is taxed by the Feds! There are limits where the taxes kick in based on single and married.Any Google search on the matter should get the facts for you - try the IRS web site too.
           
          Now, in our state, SS is NOT taxed. That really helps.
            • Re: Social Security and paying taxes
              Thanks for replying.  What state is your state that does not tax SS?
               
                • Re: Social Security and paying taxes
                  JerryD
                  Arkansas. It also allows both you and your spouse to each exclude $6,000/year in pension/IRA income from taxable income. In addition, our real estate evaluation is frozen when one spouse reaches 65 and these taxes are limited for all to 5% increase/year.
                   
                  You should be able to Google this question and get a summary of all states' treatment of SS and pension payments. 
                   
                  We moved from Illinois and our RE taxes went to about 1/3 for a much more "expensive" home, at least compared to where we came from. Relocating can be a very important retirement question that you should answer. I realize that family, interests (we moved within 10 minutes of the largest state university with all of its features including arts center and diverse, non-local population), etc. will constrain this decision, but it should at least be asked if you want to control costs. For us, we relocated or merged with kids that were already here. Problem solved.