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Summer 2014 Newsletter: Prepare for the Medicare surtax in your 2014 planning. Update-Summer2014.pdf


Winter 2013 CLIENT UPDATE Newsletter: Heath-care reform law gets underway for individuals. Update-Winter2013.pdf.


Fall 2013 CLIENT UPDATE Newsletter: Do you have obsolete inventory? Update-Fall2013.pdf.


Spring 2013 CLIENT UPDATE Newsletter: Tax legislation effects: Update-Spring2013.pdf.


Winter 2012 CLIENT UPDATE Newsletter: Year-end checklist for taxes: Update-Winter2012.pdf.


Fall 2012 CLIENT UPDATE Newsletter: Supreme Court upholds 2010 health care law: Update-Fall2012.pdf.


Summer 2012 CLIENT UPDATE Newsletter: Diversify investments by focusing on taxes: Update-Summer2012.pdf.


Spring 2012 CLIENT UPDATE Newsletter: 12 ways to improve your financial health in 2012: Update-Spring2012.pdf.


Winter 2011 CLIENT UPDATE Newsletter: Tax rules can provide relief when disaster strikes.  Update-Winter2011.pdf.


Fall 2011 CLIENT UPDATE Newsletter: New bonus depreciation rules.  UpdateFall2011.pdf.


Spring 2011 CLIENT UPDATE Newsletter: New tax rules offer opportunities. Are you saving enough?UpdateSpr2011.pdf.


Winter 2010 CLIENT UPDATE Newsletter: Small Business Jobs Act restores familiar tax breaks. UpdateWinter10.pdf.


Fall 2010 CLIENT UPDATE Newsletter: New 2010 tax credit available to small businesses.  ClientUpdateFall10.pdf.


Summer 2010 CLIENT UPDATE: Health care reform includes current and future tax changes.  ClientUpdate.pdf.


July 2014

Are Social Security benefits taxable?

 

How much, if any, of your social security benefits are taxable depends on your total income and marital status. Generally, if social security benefits are your only source of income, your benefits are not taxable. However, if you received income from other sources, you may have to include up to 85% of your social security benefits in your taxable income.

 

The amount of benefits includable in income depends on your provisional income. To calculate provisional income you start with your adjusted gross income; add back tax-exempt interest and other amounts excluded from income, plus one-half of your social security benefits. You must also add back the deduction for student loan interest, qualified tuition and fees, and the domestic production deduction.

 

None of the taxpayer’s social security benefits are included in income if provisional income does not exceed the following base amounts:

  1.     1)     $25,000 if single, HOH, qualifying widow(er), or married but filing a separate return and the taxpayer did not live with spouse at any time during the year.

  2.     2)     $32,000 if MFJ.

  3.     3)     $0 if married but filing a separate return and the taxpayer lived with spouse at any time during the year.

 

Up to 50% of social security benefits are included in gross income when the taxpayer’s provisional income exceeds the previous base amounts but is less than the adjusted base amounts. The adjusted base amounts are as follows:

  1.     (1)   $34,000 if single, HOH, qualifying widow(er), or married but filing a separate return and the taxpayer did not live with spouse at any time during the year.

  2.     (2)   $44,000 if MFJ.

  3.     (3)   $0 if married but filing a separate return and the taxpayer lived with spouse at any time during the year.

 

Up to 85% of social security benefits are included in income if provisional income exceeds the adjusted base amounts. Note that Oregon does not tax any amount of your social security benefits. If you’re nearing retirement and would like more information on how social security benefits may affect your taxable income, please give us a call.   




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