Episode 285: How Much of Your Social Security is REALLY Getting Taxed? (and At What Rate?)
How much of your social security is getting taxed, at what rate, and is there anything you can do about it? Unfortunately, the IRS doesn't make it easy for people to understand how much of their social security is taxable and at what rate. David explains that the best way to understand social security taxation is to first know about provisional income--this is the income the IRS tracks to determine how much of your social security will be taxable. As you continue to increase your IRA distributions and, therefore, your total provisional income, the percentage of your social security that becomes taxable quickly begins to rise. The IRS says that if your provisional income is between $32,000 and $44,000, up to 50% of your social security can become taxable. Fortunately, there are some scenarios where you wouldn't pay any taxes, thanks to standard deductions. The most obvious thing to do if you don’t want social security taxation is to do a Roth conversion. According to David, any income...
Ep 285: How Much of Your Social Security is REALLY Getting Taxed? (and At What Rate?)
April 17, 2024
Share
How much of your social security is getting taxed, at what rate, and is there anything you can do about it? Unfortunately, the IRS doesn't make it easy for people to understand how much of their social security is taxable and at what rate. David explains that the best way to understand social securi...
Subscribe to Our Podcast Updates
Get the latest updates and news right in your inbox.