Do I Have to Pay Taxes on my Social Security Benefit?

Retirement CentralTax Strategies
Written By gbfadmin
paying taxes on social security

paying taxes on social security

If your “combined income” exceeds specific annual limits, you may owe federal income taxes on up to 50% or 85% of your Social Security benefits.  The limits for federal income tax purposes are listed in the chart below.

percent of social security taxed

percent of social security taxed

The federal income thresholds are not indexed for inflation, so they are the same every year.  “Combined income” is defined as adjusted gross income plus any tax-exempt interest plus 50% of your Social Security Benefit.  Some states tax Social Security Benefits, whereas others do not tax them.  See the chart below:

what states do not tax social security benefits

what states do not tax social security benefits

Michael Ruger

Michael Ruger

About Michael……...

Hi, I’m Michael Ruger. I’m the managing partner of Greenbush Financial Group and the creator of the nationally recognized Money Smart Board blog . I created the blog because there are a lot of events in life that require important financial decisions. The goal is to help our readers avoid big financial missteps, discover financial solutions that they were not aware of, and to optimize their financial future.

Read More
Related Posts
Retirement Tax Traps and Penalties: 5 Gotchas That Catch People Off Guard
Retirement Tax Traps and Penalties: 5 Gotchas That Catch People Off Guard

Even the most disciplined retirees can be caught off guard by hidden tax traps and penalties. Our analysis highlights five of the biggest “retirement gotchas” — including Social Security taxes, Medicare IRMAA surcharges, RMD penalties, the widow’s penalty, and state-level tax surprises. Learn how to anticipate these costs and plan smarter to preserve more of your retirement income.

Social Security Cost of Living Increase Only 2.8% for 2026
Social Security Cost of Living Increase Only 2.8% for 2026

The Social Security Administration announced a 2.8% cost-of-living adjustment (COLA) for 2026, slightly higher than 2025’s 2.5% increase but still below the long-term average. This modest rise may not keep pace with the real cost of living, as retirees continue to face rising prices for essentials like food, utilities, and healthcare. Learn how this affects your benefits, why COLA timing matters, and strategies to help offset inflation in retirement.

Planning for Healthcare Costs in Retirement: Why Medicare Isn’t Enough
Planning for Healthcare Costs in Retirement: Why Medicare Isn’t Enough

Healthcare often becomes one of the largest and most underestimated retirement expenses. From Medicare premiums to prescription drugs and long-term care, this article from Greenbush Financial Group explains why healthcare planning is critical—and how to prepare before and after age 65.

Special Tax Considerations in Retirement
Special Tax Considerations in Retirement

Retirement doesn’t always simplify your taxes. With multiple income sources—Social Security, pensions, IRAs, brokerage accounts—comes added complexity and opportunity. This guide from Greenbush Financial Group explains how to manage taxes strategically and preserve more of your retirement income.

2025 Retirement Planning: 7 Smart Purchases to Make Before You Stop Working
2025 Retirement Planning: 7 Smart Purchases to Make Before You Stop Working

Retirement isn’t just about saving—it’s about spending wisely. From medical care and home repairs to travel and vehicles, this guide shows 7 smart purchases to consider before leaving the workforce, with tax and planning tips to help you retire stress-free.

How to Protect Yourself from Stock Market Crashes in Retirement
How to Protect Yourself from Stock Market Crashes in Retirement

Market downturns feel different in retirement than during your working years. Learn strategies to protect your nest egg, avoid irreversible mistakes, and balance growth with safety to keep your retirement plan on track.

New Ways to Plan for Long-Term Care Costs: Self-Insure & Medicaid Trusts
New Ways to Plan for Long-Term Care Costs: Self-Insure & Medicaid Trusts

Planning for long-term care is harder than ever as insurance premiums rise and availability shrinks. In 2025, families are turning to two main strategies: self-insuring with dedicated assets or using Medicaid trusts for protection and eligibility. This article breaks down how each option works, their pros and cons, and which approach fits your financial situation. Proactive planning today can help you protect assets, reduce risks, and secure peace of mind for retirement.

If You Retire With $1 Million, How Long Will It Last?
If You Retire With $1 Million, How Long Will It Last?

Is $1 million enough to retire? The answer depends on withdrawal rates, inflation, investment returns, and taxes. This article walks through different scenarios to show how long $1 million can last and what retirees should consider in their planning.

The Risk of Outliving Your Retirement Savings
The Risk of Outliving Your Retirement Savings

Living longer is a blessing, but it also means your savings must stretch further. Rising costs, inflation, and healthcare expenses can quietly erode your nest egg. This article explains how to stress-test your retirement plan to ensure your money lasts as long as you do.

How Much Money Will You Need to Retire Comfortably?
How Much Money Will You Need to Retire Comfortably?

Retirement planning isn’t just about hitting a number. From withdrawal rates and inflation to taxes and investment returns, several factors determine if your savings will truly last. This article explores how to test your retirement projections and build a plan for financial security.

Don’t Gift Your House To Your Children
Don’t Gift Your House To Your Children

A common financial mistake that I see people make when attempting to protect their house from a long-term care event is gifting their house to their children. While you may be successful at protecting the house from a Medicaid spend-down situation, you will also inadvertently be handing your children a huge tax liability after you pass away. A tax liability, that with proper planning, could be avoided entirely.

Secure Act 2.0:  RMD Start Age Pushed Back to 73 Starting in 2023
Secure Act 2.0:  RMD Start Age Pushed Back to 73 Starting in 2023

On December 23, 2022, Congress passed the Secure Act 2.0, which moved the required minimum distribution (RMD) age from the current age of 72 out to age 73 starting in 2023. They also went one step further and included in the new law bill an automatic increase in the RMD beginning in 2033, extending the RMD start age to 75.

Turn on Social Security at 62 and Your Minor Children Can Collect The Dependent Benefit
Turn on Social Security at 62 and Your Minor Children Can Collect The Dependent Benefit

Not many people realize that if you are age 62 or older and have children under the age of 18, your children are eligible to receive social security payments based on your earnings history, and it’s big money. However, social security does not advertise this little know benefit, so you have to know how to apply, the rules, and tax implications.

Self-Employment Income In Retirement? Use a Solo(k) Plan To Build Wealth
Self-Employment Income In Retirement? Use a Solo(k) Plan To Build Wealth

It’s becoming more common for retirees to take on small self-employment gigs in retirement to generate some additional income and to stay mentally active and engaged. But, it should not be overlooked that this is a tremendous wealth-building opportunity if you know the right strategies. There are many, but in this article, we will focus on the “Solo(k) strategy

Grandparent Owned 529 Accounts Just Got Better
Grandparent Owned 529 Accounts Just Got Better

A 529 account owned by a grandparent is often considered one of the most effective ways to save for college for a grandchild. But in 2023, the rules are changing………

Self-employed Individuals Are Allowed To Take A Tax Deduction For Their Medicare Premiums
Self-employed Individuals Are Allowed To Take A Tax Deduction For Their Medicare Premiums

If you are age 65 or older and self-employed, I have great news, you may be able to take a tax deduction for your Medicare Part A, B, C, and D premiums as well as the premiums that you pay for your Medicare Advantage or Medicare Supplemental coverage.

Selecting The Best Pension Payout Option
Selecting The Best Pension Payout Option

When you retire and turn on your pension, you typically have to make a decision as to how you would like to receive your benefits which includes making a decision about the survivor benefits. Do you select….

Buying A Second House In Retirement
Buying A Second House In Retirement

More and more retires are making the decision to keep their primary residence in retirement but also own a second residence, whether that be a lake house, ski lodge, or a condo down south. Maintaining two houses in retirement requires a lot of additional planning because you need to be able to answer the following questions:

Why Are Long-Term Care Insurance Premiums Skyrocketing?
Why Are Long-Term Care Insurance Premiums Skyrocketing?

Many individuals that have long-term care insurance policies are beginning to receive letters in the mail notifying them that that their insurance premiums are going up by 50%, 70%, or more in some cases. This is after many of the same policyholders have experienced similar size premium increases just a few years ago. In this article I’m going to explain……

Do You Have To Pay Tax On Your Social Security Benefits?
Do You Have To Pay Tax On Your Social Security Benefits?
Retirement Account Withdrawal Strategies
Retirement Account Withdrawal Strategies

The order in which you take distributions from your retirement accounts absolutely matters in retirement. If you don’t have a formal withdraw strategy it could end up costing you in more ways than one. Click to read more on how this can effect you.

When To Enroll In Medicare
When To Enroll In Medicare

Medicare has important deadlines that you need to be aware of during your initial enrollment period. Missing those deadlines could mean gaps in coverage, penalties, and limited options when it comes to selecting a Medicare

How Do Social Security Survivor Benefits Work?
How Do Social Security Survivor Benefits Work?

Social Security payments can sometimes be a significant portion of a couple’s retirement income. If your spouse passes away unexpectedly, it can have a dramatic impact on your financial wellbeing in retirement. This is especially

Medicare Supplemental Plans ("Medigap") vs. Medicare Advantage Plans
Medicare Supplemental Plans ("Medigap") vs. Medicare Advantage Plans

As you approach age 65, there are a lot of very important decisions that you will have to make regarding your Medicare coverage. Since Medicare Parts A & B by itself have deductibles, coinsurance, and no maximum out of pocket

IRA RMD Start Date Changed From Age 70 ½ to Age 72 Starting In 2020
IRA RMD Start Date Changed From Age 70 ½ to Age 72 Starting In 2020

The SECURE Act was passed into law on December 19, 2019 and with it came some big changes to the required minimum distribution (“RMD”) requirements from IRA’s and retirement plans. Prior to December 31, 2019, individuals

Introduction To Medicare
Introduction To Medicare

As you approach age 65, there are very important decisions that you will have to make regarding your Medicare coverage. Whether you decide to retire prior to age 65, continue to work past age 65, or have retiree health benefits,

Potential Consequences of Taking IRA Distributions to Pay Off Debt
Potential Consequences of Taking IRA Distributions to Pay Off Debt

Once there is no longer a paycheck, retirees will typically meet expenses with a combination of social security, withdrawals from retirement accounts, annuities, and pensions. Social security, pensions, and annuities are usually fixed amounts, while withdrawals from retirement accounts could fluctuate based on need. This flexibility presents

How To Change Your Residency To Another State For Tax Purposes
How To Change Your Residency To Another State For Tax Purposes

If you live in an unfriendly tax state such as New York or California, it’s not uncommon for your retirement plans to include a move to a more tax friendly state once your working years are over. Many southern states offer nicer weather, no income taxes, and lower property taxes. According to data from the US Census Bureau, more residents

Advanced Tax Strategies For Inherited IRA's
Advanced Tax Strategies For Inherited IRA's

Inherited IRA’s can be tricky. There are a lot of rules surrounding;

Establishment and required minimum distribution (“RMD”) deadlines

Options available to spouse and non-spouse beneficiaries

Strategies for deferring required minimum distributions

Special 60 day rollover rules for inherited IRA’s

What Happens To My Pension If The Company Goes Bankrupt?
What Happens To My Pension If The Company Goes Bankrupt?

Given the downward spiral that GE has been in over the past year, we have received the same question over and over again from a number of GE employees and retirees: “If GE goes bankrupt, what happens to my pension?” While it's anyone’s guess what the future holds for GE, this is an important question that any employee with a pension should

gbfadmin
Previous

How is my Social Security Benefit Calculated?
Next

Can I Receive Social Security Benefits While I'm Still Working?