Albany,n.y. Posted February 10 Author Share Posted February 10 39 minutes ago, T&C said: I believe you have to hit a certain threshold for SS to be taxed, so not everyone is taxed. https://smartasset.com/retirement/is-social-security-income-taxable If you're at poverty level, you don't pay SS taxes. If you're middle class, you're likely being taxed on 85% of your SS income. I've never been taxed at less than 85% of my SS income. Your Social Security benefits could be taxable, depending on your situation. According to the IRS, the best way to see if you’ll owe taxes on your Social Security income is to take one-half of your Social Security benefits and add that amount to all your other income. This includes tax-exempt interest. This number is known as your combined income, and this is how it’s calculated: Combined Income = Adjusted Gross Income (AGI) + Nontaxable Interest + 1/2 of Social Security benefits If your combined income is above a certain limit (the IRS calls this limit the base amount), you will need to pay at least some tax. The limit for 2023 and 2024 is $25,000 if you are a single filer, head of household or qualifying widow or widower with a dependent child. The 2023 and 2024 limit for joint filers is $32,000. However, if you’re married and file separately, you’ll likely have to pay taxes on your Social Security income. How to Calculate Your Social Security Income Taxes If your Social Security income is taxable, the amount you pay will depend on your total combined retirement income. However, you will never pay taxes on more than 85% of your Social Security income, though the income brackets will vary by filing status. If you file your income tax return as an individual with a total income that’s less than $25,000, you won’t have to pay taxes on your Social Security benefits. Single filers with a combined income of $25,000 to $34,000 must pay income taxes on up to 50% of their Social Security benefits. If your combined income is more than $34,000, you will pay taxes on up to 85% of your Social Security benefits. For married couples filing a joint return, you will pay taxes on up to 50% of your Social Security income if you have a combined income of $32,000 to $44,000. If you have a combined income of more than $44,000, you can expect to pay taxes on up to 85% of your Social Security payments. 1 1 Quote Link to comment Share on other sites More sharing options...
T&C Posted February 10 Share Posted February 10 16 minutes ago, Albany,n.y. said: If you're at poverty level, you don't pay SS taxes. If you're middle class, you're likely being taxed on 85% of your SS income. I've never been taxed at less than 85% of my SS income. Your Social Security benefits could be taxable, depending on your situation. According to the IRS, the best way to see if you’ll owe taxes on your Social Security income is to take one-half of your Social Security benefits and add that amount to all your other income. This includes tax-exempt interest. This number is known as your combined income, and this is how it’s calculated: Combined Income = Adjusted Gross Income (AGI) + Nontaxable Interest + 1/2 of Social Security benefits If your combined income is above a certain limit (the IRS calls this limit the base amount), you will need to pay at least some tax. The limit for 2023 and 2024 is $25,000 if you are a single filer, head of household or qualifying widow or widower with a dependent child. The 2023 and 2024 limit for joint filers is $32,000. However, if you’re married and file separately, you’ll likely have to pay taxes on your Social Security income. How to Calculate Your Social Security Income Taxes If your Social Security income is taxable, the amount you pay will depend on your total combined retirement income. However, you will never pay taxes on more than 85% of your Social Security income, though the income brackets will vary by filing status. If you file your income tax return as an individual with a total income that’s less than $25,000, you won’t have to pay taxes on your Social Security benefits. Single filers with a combined income of $25,000 to $34,000 must pay income taxes on up to 50% of their Social Security benefits. If your combined income is more than $34,000, you will pay taxes on up to 85% of your Social Security benefits. For married couples filing a joint return, you will pay taxes on up to 50% of your Social Security income if you have a combined income of $32,000 to $44,000. If you have a combined income of more than $44,000, you can expect to pay taxes on up to 85% of your Social Security payments. Exactly. That's why it's important to keep your side jobs cash only and under 6k for all other income ventures. Quote Link to comment Share on other sites More sharing options...
Irv Posted February 10 Share Posted February 10 2 hours ago, Albany,n.y. said: At current interest rates, the difference is negligible on paying extra on your salary and getting a refund, especially with only 12 months of payments in before cashing out. The Christmas Club rates at my bank are 0.5% The best choice is based on lifestyle. I want Super Bowl money & don't have the discipline to put together a Super Bowl fund all year, so I let the government hold my Super Bowl fund until the game. Now with no Super Bowl, I have a few extra thousand to spend recklessly. No. You don't know how, or what to invest in. Huge mistake. If you like lending money at no interest, can I borrow 10G's? Thanks! Quote Link to comment Share on other sites More sharing options...
Albany,n.y. Posted February 10 Author Share Posted February 10 38 minutes ago, Irv said: No. You don't know how, or what to invest in. Huge mistake. If you like lending money at no interest, can I borrow 10G's? Thanks! Get a job with the IRS & your paycheck will be my loan to you. 41 minutes ago, T&C said: Exactly. That's why it's important to keep your side jobs cash only and under 6k for all other income ventures. Or, you do retirement right and don't need any side job. 1 1 1 Quote Link to comment Share on other sites More sharing options...
T&C Posted February 10 Share Posted February 10 28 minutes ago, Albany,n.y. said: Or, you do retirement right and don't need any side job. Side stuff is fun actually... keeps you moving and social... it's not like a job, more like hobbies that others have the same interest in but you make money from it. Can't sit in a chair all day long, that'll for sure take some years away from your life. 2 Quote Link to comment Share on other sites More sharing options...
Draconator Posted February 11 Share Posted February 11 On 2/9/2024 at 8:17 PM, Irv said: No. You don't know how, or what to invest in. Huge mistake. If you like lending money at no interest, can I borrow 10G's? Thanks! So what exactly do you do for a living? Not asking to be a smartass, just honestly curious. Quote Link to comment Share on other sites More sharing options...
Augie Posted February 11 Share Posted February 11 (edited) 1 hour ago, Draconator said: So what exactly do you do for a living? Not asking to be a smartass, just honestly curious. My brother-in-law will do everything in the absolute optimal way. He’s a chemical engineer and is more at home with details than people. He would calculate the total amount and determine the daily cost of funds at today’s rates, etc. Do the math. Sure, if I’m a Family Office (~$100Mil) kind of rich guy, we’ll pay someone to do the best they can because that is real money. Likewise, if every penny mattered I’d do what I could at every turn because I need the money. We are in between. I’d rather know it’s done and paid for and move on if I’m looking at a typical tax payment. For a few hundred extra dollars max sitting on the cash for a couple extra months…..we can’t be bothered. If we owe it, we like to pay it, even if it’s to the government. EDIT: I just did some rough math on what we’d gain by holding onto our money until the last minute. Even in what is, for us, a huge tax bill year, it’s not worth dragging it out. I feel better looking at it that way. . Edited February 11 by Augie Quote Link to comment Share on other sites More sharing options...
Albany,n.y. Posted February 12 Author Share Posted February 12 17 hours ago, Draconator said: So what exactly do you do for a living? Not asking to be a smartass, just honestly curious. Obviously, he's not making enough if he's asking to borrow $10,000. 😀 17 hours ago, Augie said: My brother-in-law will do everything in the absolute optimal way. He’s a chemical engineer and is more at home with details than people. He would calculate the total amount and determine the daily cost of funds at today’s rates, etc. Do the math. Sure, if I’m a Family Office (~$100Mil) kind of rich guy, we’ll pay someone to do the best they can because that is real money. Likewise, if every penny mattered I’d do what I could at every turn because I need the money. We are in between. I’d rather know it’s done and paid for and move on if I’m looking at a typical tax payment. For a few hundred extra dollars max sitting on the cash for a couple extra months…..we can’t be bothered. If we owe it, we like to pay it, even if it’s to the government. EDIT: I just did some rough math on what we’d gain by holding onto our money until the last minute. Even in what is, for us, a huge tax bill year, it’s not worth dragging it out. I feel better looking at it that way. . I've always done my taxes in January. Even when I owed, I'd send the payment in right away. 1 Quote Link to comment Share on other sites More sharing options...
Irv Posted February 12 Share Posted February 12 17 hours ago, Draconator said: So what exactly do you do for a living? Not asking to be a smartass, just honestly curious. Independently wealthy. 1 Quote Link to comment Share on other sites More sharing options...
SoTier Posted February 13 Share Posted February 13 (edited) On 2/9/2024 at 3:49 PM, T&C said: If you live in NY isn't the SS 1099 just a worthless piece of paper seeing as no taxes are taken out? As Albany, n.y. posted, whether you pay tax on your SS will depend upon your total income including SS. NYS does not tax social security at all but the Feds do if your income is high enough, so you always need your SS 1099. If you live in New York and own your residence, then you need to file a NY state tax return in order to qualify for STAR regular and senior property tax exemptions even if you don't have to pay state taxes. If you have enough income from sources other than SS, pension, and/or retirement annuity payouts, you will also have to file a state return and pay taxes on that extra income. Edited February 13 by SoTier 1 Quote Link to comment Share on other sites More sharing options...
Albany,n.y. Posted February 13 Author Share Posted February 13 15 hours ago, SoTier said: As Albany, n.y. posted, whether you pay tax on your SS will depend upon your total income including SS. NYS does not tax social security at all but the Feds do if your income is high enough, so you always need your SS 1099. If you live in New York and own your residence, then you need to file a NY state tax return in order to qualify for STAR regular and senior property tax exemptions even if you don't have to pay state taxes. If you have enough income from sources other than SS, pension, and/or retirement annuity payouts, you will also have to file a state retirement return and pay taxes on that extra income. Some pensions in NYS are taxable except for certain government pensions:https://states.aarp.org/new-york/state-taxes-guide Are pensions or retirement income taxed in New York? Yes, money withdrawn from pensions and 401(k)s, 403(b)s and IRAs are combined and taxed as regular income. Tax rates run from 4 percent to 10.9 percent, just like for other income. But federal, New York state pensions and military retirement pay are tax-exempt. For those 59½ or older, the first $20,000 of retirement income (from a corporate pension, an IRA, a 401(k) account or another retirement plan) is tax-exempt. Married couples get a double exemption (each spouse is eligible for the $20,000 exclusion) for a total of $40,000. 1 Quote Link to comment Share on other sites More sharing options...
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