Social Security Disability benefits are provided to those who meet specific medical criteria and fall within specified income ranges. These benefits are aimed at supplementing other income or benefits received by those with diagnosed medical conditions. However, despite the fact that millions of people rely on these benefits every month, the federal government can tax them.
When Can Social Security Disability Benefits Be Taxed?
Because income levels already govern the amount of Social Security Disability benefits a person can receive, it is rare that a recipient would owe taxes on them. However, depending on one's income and marital situation, 85 percent of the benefits could be taxed.
The following rates and income ranges apply to a recipient filing taxes as single and head of household, or a widow or widower with a dependent child:
- Up to 50 percent of benefits may be taxed if combined annual income is between $25,000 and $34,000
- Up to 85 percent of benefits may be taxed if combined annual income exceeds $34,000
Those ranges also apply for married recipients filing separately who did not live with their spouse during the previous tax year.
For a married recipient filing jointly, the following income ranges and tax rates apply:
- Up to 50 percent of benefits may be taxed if both spouses' combined income is between $32,000 and $44,000
- Up to 85 percent of benefits may be taxed if both spouses' combined income is more than $44,000
Because Social Security Disability benefits are aimed at assisting those who truly need them, the government is going to try to recoup any payments above set limits. If you have any questions about Social Security Disability and taxes, speak to an experienced Social Security Disability attorney to discuss your situation and your options.