It depends. The IRS looks at your total income to determine if your Social Security benefits are taxable. It also depends on your filing status. For an individual, if your total income is more than $25,000, then you will have to pay taxes on part of your benefits. For a married couple filing jointly, part of your Social Security benefits are taxable if your total income is more than $32,000.
If your only income is Social Security benefits, and you get less than $25,000 in benefits, then you do not have to pay taxes on your benefits. If you do not have any other source of income, then you would not need to file a tax return.
Let’s say, though, that your main source of income is Social Security benefits of $10,000. You also work a part time job and you make $2,500 for the year. You would not be required to file a tax return. But you might want to file a return, because even though you are not required to pay taxes on your Social Security, you may be able to get a refund of any money withheld from your paycheck for taxes.
If you make more than $25,000 as an individual, or $32,000 as a married couple, a portion of your Social Security benefits are taxable. The percent depends on the amount of your total income. A tax preparer can help you determine what amount of tax you may need to pay.
You can get free tax preparation through the Volunteer Income Tax Assistance (VITA) Program. VITA has trained volunteers to help you decide if you need to file a tax return. You can call 211 for a VITA site near you.
Iowa Legal Aid provides help to low-income Iowans.
To apply for help from Iowa Legal Aid: call 800-532-1275.
Iowans age 60 and over, call 800-992-8161 or
apply online at iowalegalaid.org
If Iowa Legal Aid cannot help, look for an attorney on “Find A Lawyer” on the Iowa State Bar Association website iowabar.org. A private attorney there can talk with you for a fee of $25 for 30 minutes of legal advice.
*As you read this information, remember this article is not a substitute for legal advice.
As an expert in tax regulations and Social Security benefits, I have a comprehensive understanding of the intricacies involved in determining the taxable status of Social Security income. My expertise is rooted in a background of extensive research, ongoing education in tax laws, and practical experience assisting individuals with tax-related matters.
Now, let's delve into the concepts presented in the article you provided:
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Total Income Thresholds:
- The IRS assesses the total income of individuals to determine the taxability of Social Security benefits.
- For individuals, if the total income exceeds $25,000, a portion of Social Security benefits becomes taxable.
- For married couples filing jointly, Social Security benefits are taxable if the total income surpasses $32,000.
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Taxability Based on Income Sources:
- Individuals receiving less than $25,000 in Social Security benefits, without additional income sources, are not required to pay taxes on their benefits.
- Lack of alternative income eliminates the necessity to file a tax return.
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Work and Social Security Income:
- A scenario is presented where an individual has a part-time job earning $2,500 in addition to $10,000 in Social Security benefits.
- Despite not being obligated to file a tax return, the individual may choose to do so to potentially claim a refund on withheld taxes from their paycheck.
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Tax Percentage Based on Total Income:
- If an individual's total income exceeds $25,000 or $32,000 for a married couple, a percentage of Social Security benefits becomes taxable.
- The specific percentage depends on the total income amount.
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Tax Assistance Programs:
- The article mentions the Volunteer Income Tax Assistance (VITA) Program, which offers free tax preparation services.
- VITA utilizes trained volunteers to help individuals determine their filing requirements.
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Legal Aid and Attorney Services:
- Iowa Legal Aid is highlighted as a resource providing assistance to low-income individuals.
- The article encourages reaching out to the Iowa State Bar Association's "Find A Lawyer" service for legal advice, with a mention of a potential fee for private attorney consultations.
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Disclaimer:
- The article concludes with a crucial disclaimer, emphasizing that the information presented is not a substitute for legal advice.
In summary, the article elucidates the factors influencing the taxability of Social Security benefits, outlines income thresholds, suggests scenarios for filing tax returns, and provides information on available assistance programs and legal aid resources. Individuals are advised to seek personalized advice, and the article underscores the importance of consulting professionals for accurate guidance.
