What to Do With Social Security Tax Forms You Get in the Mail
Did you get a Social Security tax form in the mail?
Chances are you’re talking about a SSA-1099, which is your statement of Social Security benefit income. If you are receiving Social Security benefits then each year you will receive IRS Form SSA-1099. That’s because your benefits are considered income by the IRS and you may need to pay income tax on your benefits. Even if you don’t end up having to pay taxes on them, you still need to include on your 1040 the amounts shown on the Social Security tax forms you get from the Social Security Administration.
The Social Security 1099 Form
If you are getting your Social Security benefits then you will have to use IRS Form 1040A or 1040 to file your federal income tax return. Use SSA-1099 to report the amount that was paid to you for that tax year. It goes on line 14a of IRS Form 1040A…use box 5 on your SSa-1099 to get the correct amount to report.
Would You Like the SSA to Withhold Taxes on Your Social Security Benefits?
You can choose to have taxes withheld from your Social Security checks each month. Use IRS Form W4-V to indicate how much you’d like taken out. This is called voluntary withholding. The choices are as follows:
- 5%
- 7%
- 15%
- 25%
When are Social Security Benefits Not Taxable?
You don’t have to pay income tax on your Social Security benefits if you make under a certain amount of income annually. These thresholds are as follows:
- if you are single and total income is under $25,000 then you do not have to pay income taxes on your Social Security benefits
- the threshold amount for married filing jointly is $32,000
If You Make Too Much, They Take Most of it Away!
That’s right, if you are single and your total combined income for the year is over $34,000 then your Social Security tax rate is 85%.
your Social Security tax rate is eighty five percent if you make over $34,000!
That is the IRS’s way of telling you that you don’t need Social Security benefits. For this reason, retirees who have part time jobs usually don’t want to make too much money, or they’ll “lose” their benefits. After all, the Social Security system was designed as a safety net, so if you don’t need it well…someone else surely does, you can count on that, whether or not you or anyone else believes it to be fair!