Taxes on Social Security Benefits

Q: Are Social Security benefits taxable?

A: It depends.

Long answer: Some people have to pay federal income taxes on their Social Security benefits. But this usually happens only if you have other income (such as wages, self-employment, interest, dividends and other taxable income that must be reported on your tax return) in addition to your benefits. The good news, if you can call it that, is that no one pays federal income tax on more than 85 percent of his or her Social Security benefits.  This does not mean you are taxed at an 85% rate. This means, at worst, 15% of your benefit is tax free, and 85% of your benefit is taxable.

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