24 THE QUEENS COURIER • MARCH 6, 2014 FOR BREAKING NEWS VISIT www.queenscourier.com tax tips Are My Social Security Benefi ts Taxable? BY BARRY LISAK The Social Security benefi ts you received in 2013 may be taxable. Each January, you should receive a Form SSA-1099 (Social Security Benefi t Statement) which will show the total amount of your benefi ts. The information provided on this statement along with the following facts from the IRS will help you determine whether your benefi ts are taxable. 1. How much, if any, of your Social Security benefi ts are taxable depends on your marital status and gross income. 2. Generally, if Social Security benefi ts were your only income for 2013, your benefi ts are not taxable and probably you do not need to fi le a Federal tax return. 3. If you received income from other sources, your benefi ts will not be taxed unless your modifi ed adjusted gross income (MAGI) is more than the base amount for your fi ling status. 4. The 2013 base amounts are: $32,000 for married couples fi ling jointly. $25,000 for the other fi ling statuses. $0 for married persons fi ling separately who lived together during the year. 5. You can do the following quick computation to determine whether some of your benefi ts may be taxable: First, add one-half of the total Social Security benefi ts you received to all your other income, including any taxexempt interest. Then, compare this total to the base amount for your fi ling status. It the total is more than your base amount, some of your benefi ts may be taxable. 6. If you are single and your total combined income for the year is between $25,000 and $34,000, then up to 50 percent of your benefi ts can be taxed. If your income is greater than $34,000, then up to 85 percent of your benefi ts can be taxed. An example: Ashley, who is single, has 2013 earnings of $16,000, $500 in interest income, and $700 in dividends. She also receives $10,800 of net Social Security benefi ts. Ashley’s provisional income is $22,600 {$16,000+$500+$700+$5,400 (one-half of the net Social Security benefi ts)}. Since $22,600 does not exceed the $25,000 base amount, none of Ashley’s Social Security benefi ts are taxable. Married couples fi ling jointly whose combined income is between $32,000 and $44,000, up to 50 percent of your benefi ts can be taxed. Incomes greater than $44,000 are taxed at the 85-percent rate. Another example: Brandon and Sydney, a husband and wife who have $24,000 in Social Security income and $25,000 of other income would pay taxes calculated as follows: These taxpayers would add half of their Social security income ($12,000) to their $25,000 in other income for a provisional amount of $37,000. Next step, fi nd the amount by which their income exceeds the $32,000 threshold ($37,000-$32,000). The excess amount is $5,000 and half of that is $2,500. Now all they have to do is add $2,500 in taxable Social Security income to their other income and their total taxable income becomes $27,500. 7. The Federal taxable portion of your Social Security benefi ts cannot exceed 85-percent of your total benefi ts. Most importantly, all Social Security benefi ts are exempt from NYS and NYC taxes. 8. If you do have to pay Federal taxes on your Social Security benefi ts, you can have the taxes withheld from your benefi ts. You can choose to have 7-percent, 10-percent, 15-percent, or 25-percent of your total benefi t payment withheld. Simply complete Form W-4V, Voluntary Withholding Request, and fi le it with the Social Security Administration (1-800-SSA-1213). Alternatively, you can make quarterly estimated tax payments to the IRS. 9. If both you and your child received Social Security benefi ts, you must use only your own portion (and not your child’s portion) of the benefi ts in fi guring if any part is taxable on your tax return. For additional information on the taxability of Social Security benefi ts, see IRS Publication 915, Social Security and Equivalent Railroad Retirement Benefi ts. This publication is available on the IRS website (www.irs.gov) or by calling 800- 829-1040. s LJC@loucarino.com *$99 minimum tax preparation fee. Please bring your invoice from last year’s tax preparation fees. Offer available for 2013 tax returns only. Not to be combined with any other offer. Non-negotiable. No cash value. If you had your taxes prepared by Gilman Ciocia in 2013, you do not qualify for this promotion. This discount must be requested at time of service, no credits will be issued after the tax return has been filed. Offer expires March 31, 2014. WESLEY HITNER, CPA F r e s h M e a d o w s , N Y 1 1 3 6 6 718-465-3466 This tax season, have your taxes prepared in the comfort of your home. I make house calls. I am a CPA with over 25 years of experience. Other services include small business/corporation accounting and taxes. NO JOB IS TOO SMALL. CALL ME FOR A FREE CONSULTATION
QC03072014
To see the actual publication please follow the link above