Tracy’s Tax Tips: Social Security Benefits

If you are a Social Security recipient, your benefits may be taxable.

FOX Business Network’s Tracy Byrnes explains in this edition of “Tracy’s Tax Tips”:

Here’s a tax-time zinger: Many people don’t realize that their Social Security benefits are taxable.

I’m Tracy Byrnes with the FOX Business Network here with Tracy’s Tax Tips.

All Social Security recipients should receive Form SSA-1099 from the Social Security Administration that shows the total amount of their benefits and what’s taxable. For the first time in 2012, workers can access their Social Security statements online.

Now, the taxability of your benefits depends on a bunch of things like your marital status and your total income.

Generally, if your Social Security benefits were your only income for 2012, they’re not taxable and you probably don’t even have to file a federal income tax return, but check with your tax preparer.

If you did have other income, you can do a quick little calculation to determine if you have a tax bill. Add one-half of your total Social Security benefits to all your other taxable income. If that amount is greater than $32,000 for married couples filing jointly, or $25,000 for singles or head of households, your benefits may be taxable.