social security and income question

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Subject Author Date social security and income question sandybeth 05-31-2009  Re: social security and income question Arthur Kamlet 05-31-2009  Re: social security and income question D. Stussy 06-01-2009  Re: social security and income question Arthur Kamlet 06-01-2009  Re: social security and income question D. Stussy 06-01-2009  Re: social security and income question sandybeth 06-01-2009  Re: social security and income question Arthur Kamlet 06-01-2009  Re: social security and income question Mark Bole 06-01-2009  Re: social security and income question D. Stussy 06-01-2009
Posted by sandybeth on May 31, 2009, 8:40 pm Please log in for more thread options I've been collecting Social Security since last December. Since our retirement funds have tanked so much in our ira's, I'm considering entering the part-time work force again so we don't have to withdraw from ira's yet. I know that you can only have $14160 of earned income before you have to pay half back (above that) to SS. However, what if I earn more and put the max into my Roth, bringing my taxable income under $14160? Will that work or is it not allowed? SandyBeth -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Arthur Kamlet on May 31, 2009, 8:53 pm Please log in for more thread options >I've been collecting Social Security since last December. Since our >retirement funds have tanked so much in our ira's, I'm considering >entering the part-time work force again so we don't have to withdraw >from ira's yet. I know that you can only have $14160 of earned income >before you have to pay half back (above that) to SS. However, what if >I earn more and put the max into my Roth, bringing my taxable income >under $14160? Will that work or is it not allowed? Your Roth contribution is not deducted from either your taxable income or your social security income. By the way, in the year you turn your full retirement age of 66, there is a higher amount of threshold and a diferent computation to make and you end up better off. And earnings after you do reach full retirement age are not subjected to payback. Perhaps you were thinking of contributing and deducting from adjusted gross income, amounts contributed to a traditional IRA? That could reduce the amount of social security income subject to being listed as taxable income, but will not reduce the amount of payback you would owe to social security. -- ArtKamlet at a o l dot c o m Columbus OH K2PZH -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by D. Stussy on June 1, 2009, 10:31 am Please log in for more thread options > In article > >I've been collecting Social Security since last December. Since our > >retirement funds have tanked so much in our ira's, I'm considering > >entering the part-time work force again so we don't have to withdraw > >from ira's yet. I know that you can only have $14160 of earned income > >before you have to pay half back (above that) to SS. However, what if > >I earn more and put the max into my Roth, bringing my taxable income > >under $14160? Will that work or is it not allowed? > > Your Roth contribution is not deducted from either your taxable > income or your social security income. > > By the way, in the year you turn your full retirement age of 66, > there is a higher amount of threshold and a diferent computation > to make and you end up better off. And earnings after you do reach > full retirement age are not subjected to payback. > > Perhaps you were thinking of contributing and deducting from adjusted gross > income, amounts contributed to a traditional IRA? That could reduce the > amount of social security income subject to being listed as taxable income, > but will not reduce the amount of payback you would owe to social security. As this was posted to a tax group, there is one piece of information that the above left out: If your income, INCLUDING SSRB, is less than $25k (or $32k if married filing jointly with a spouse), then your social security income remains tax free. However, such is not true if you file a married-separate tax return. Exceed those levels and it will start to become taxable (a phase-in), and if your other income before adding SSRB exceeds these limits, then your SSRB is included in your taxable income (subject to its maximum limits). If you have other deductions, exemptions, and credits that will wipe that out, then your income tax won't change. Note that for the next 4 years (i.e. before you turn 70.5), you could use a traditional IRA, then convert it to a Roth (hopefully, you've stopped working then - as the conversion amount will be taxable) so as to avoid "required minimum distributions." -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Arthur Kamlet on June 1, 2009, 1:41 pm Please log in for more thread options >> In article >> >I've been collecting Social Security since last December. Since our >> >retirement funds have tanked so much in our ira's, I'm considering >> >entering the part-time work force again so we don't have to withdraw >> >from ira's yet. I know that you can only have $14160 of earned income >> >before you have to pay half back (above that) to SS. However, what if >> >I earn more and put the max into my Roth, bringing my taxable income >> >under $14160? Will that work or is it not allowed? >> >> Your Roth contribution is not deducted from either your taxable >> income or your social security income. >> >> By the way, in the year you turn your full retirement age of 66, >> there is a higher amount of threshold and a diferent computation >> to make and you end up better off. And earnings after you do reach >> full retirement age are not subjected to payback. >> >> Perhaps you were thinking of contributing and deducting from adjusted >gross >> income, amounts contributed to a traditional IRA? That could reduce the >> amount of social security income subject to being listed as taxable >income, >> but will not reduce the amount of payback you would owe to social >security. > >As this was posted to a tax group, there is one piece of information that >the above left out: Not left out, see the original reply for someinformation on taxability of social security income. That of course is a diferent situation. >If your income, INCLUDING SSRB, is less than $25k (or $32k if married >filing jointly with a spouse), then your social security income remains tax >free. I'm sure you meant to say INCLUDING HALF YOUR SSRB > However, such is not true if you file a married-separate tax return. No indication here of marriage status But if filing MFS and if lived with spouse at all during the year, then 85% of SSRB becomes income subject to income tax. >Exceed those levels and it will start to become taxable (a phase-in), and >if your other income before adding SSRB exceeds these limits, then your >SSRB is included in your taxable income (subject to its maximum limits). >If you have other deductions, exemptions, and credits that will wipe that >out, then your income tax won't change. > >Note that for the next 4 years (i.e. before you turn 70.5), you could use a >traditional IRA, then convert it to a Roth (hopefully, you've stopped >working then - as the conversion amount will be taxable) so as to avoid >"required minimum distributions." -- ArtKamlet at a o l dot c o m Columbus OH K2PZH -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by D. Stussy on June 1, 2009, 11:43 pm Please log in for more thread options > >> In article > >> >I've been collecting Social Security since last December. Since our > >> >retirement funds have tanked so much in our ira's, I'm considering > >> >entering the part-time work force again so we don't have to withdraw > >> >from ira's yet. I know that you can only have $14160 of earned income > >> >before you have to pay half back (above that) to SS. However, what if > >> >I earn more and put the max into my Roth, bringing my taxable income > >> >under $14160? Will that work or is it not allowed? > >> > >> Your Roth contribution is not deducted from either your taxable > >> income or your social security income. > >> > >> By the way, in the year you turn your full retirement age of 66, > >> there is a higher amount of threshold and a diferent computation > >> to make and you end up better off. And earnings after you do reach > >> full retirement age are not subjected to payback. > >> > >> Perhaps you were thinking of contributing and deducting from adjusted > >gross > >> income, amounts contributed to a traditional IRA? That could reduce the > >> amount of social security income subject to being listed as taxable > >income, > >> but will not reduce the amount of payback you would owe to social > >security. > > > >As this was posted to a tax group, there is one piece of information that > >the above left out: > > Not left out, see the original reply for someinformation on taxability > of social security income. That of course is a diferent situation. > > >If your income, INCLUDING SSRB, is less than $25k (or $32k if married > >filing jointly with a spouse), then your social security income remains tax > >free. > > I'm sure you meant to say INCLUDING HALF YOUR SSRB Actually, if the total with all of it is less than $25k, then the total with half of it will also be less than $25k. I find it's easier to have the clients add all of it to compare to the limit than to halve it and add. Some clients are math morons. > > However, such is not true if you file a married-separate tax return. > > No indication here of marriage status > > But if filing MFS and if lived with spouse at all during the year, > then 85% of SSRB becomes income subject to income tax. That's why I left out "half" above. 85% isn't half. > > ... -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Similar Threads Posted Where to put Social Security income. 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