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Are Social Security Benefits Taxable?

by | Jun 1, 2022 | Social Security Disability Process And Benefits |

Are Social Security Benefits Taxable?

Some, but not all, people will have to pay taxes on their social security benefits. But NO ONE will pay tax on more than 85% of their Social Security Benefits, per IRS Rules.

If you are filing a tax return as an individual single filer, and your total combined income is between $25,000 and $34,000 you may have to pay income tax on up to 50% of your benefits, if your income is more than $34,000 up to 85% of your benefits may be taxable.

If you file a joint return, with a spouse, and your total combined income is between $32,000 and $44,000 you may have to pay income tax on up to 50% of your benefits, if your combined income is more than $44,000 then up to 85% of your benefits may be taxable. Even if married but filing separately, you will most likely pay taxes on a percentage of benefits.

If you do need to pay income taxes on your benefits, you can elect to make quarterly payments to the IRS.

Are Social Security Benefits Retroactive?

In most cases, there is some back pay with either Supplemental Security Income (SSI) benefits or Social Security Disability Insurance (SSDI) benefits.

SSI benefits can only pay back to the date which you filed for benefits, so for example if you filed for benefits on 1/1/2021 and were awarded benefits 5/15/2022, you would receive back payments for January 2021 through May 2022.

SSDI benefits are a little more complicated. When you file for disability you indicate the date on which you became disabled, this is your alleged onset date. If your alleged onset date is more than 17 months prior to the date on which you filed for benefits, you will only be able to receive back payments for the 17 months immediately prior to filing. Even so, there is a five month waiting period before SSDI benefits kick in, so in reality you get 12 months of payments before the date of filing if your alleged onset date is that far before your date of filing. For example, if you file for SSDI on 1/1/2021 with an alleged onset date of 1/1/2019, the earliest month you would be eligible for SSDI back payment benefits would be January 2020. If you were awarded on 5/15/2022, you would receive back payments for January 2020 through May 2022.

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