Taxes on Social Security income is determined by the provisional income formula:
Provisional income (PI) = adjusted gross income (AGI) + tax-exempt bond interest + 50% of your Social Security benefits.
If your PI for the year is above these thresholds, some of your benefits may be taxable.
|
Provisional income threshold |
% of taxable benefits | |
|---|---|---|
|
Single |
$0 to $25,000 |
0% |
|
> $25,000 |
Up to 50% |
|
|
> $34,000 |
Up to 85% |
|
|
Married, filing jointly |
$0 to $32,000 |
0% |
|
> $32,000 |
Up to 50% |
|
|
> $44,000 |
Up to 85% |
|
|
Married, filing separately* |
> $0 |
Up to 85% |
*This applies if your tax status is "married, filing separately" and you lived with your spouse at any time during the tax year.
The amount of Social Security income that's taxable is the smallest of the following three calculations:
1. 85% of Social Security benefits.
2. 50% of Social Security benefits + 85% of PI over $34,000 (single) or $44,000 (married, filing jointly.
3. 50% of PI over $25,000 (single) or $32,000 (married, filing jointly) + 35% of PI over $34,000 (single) or $44,000 (married, filing jointly).
Most states don't tax Social Security benefits. But the ones that do either follow the same federal PI rules, or they have special rules and income thresholds to determine what's taxable.
These four states use the federal PI formula: Minnesota, North Dakota, Vermont, and West Virginia. The taxable portion of Social Security for these states is the same as the federal amount.
The nine states listed in the chart below have special rules and income thresholds. Most use the feeral AGI formula rather than the federal PI formula for taxing Social Security income.
States with special rules for taxing Social Security |
|
|
If your AGI or income is above the thresholds for your state and filing status, a portion of your Social Security benefits may be taxed. |
|
|
Colorado |
Income > $20,000 (under age 65) Income above includes Social Security and distributions from IRAs, pensions, and annuities. In Colorado, this income threshold applies to each married, filing jointly spouse. |
|
Connecticut |
AGI > $50,000 (single) |
|
Kansas |
AGI > $75,000 (all filing statuses) |
|
Missouri |
AGI > $85,000 (single) |
|
Montana |
Income > $25,000 (single) Montana uses Worksheet VIII instead of the federal AGI. |
|
Nebraska |
AGI > $43,000 (single; married, filing separately) |
|
New Mexico |
$8,000 income exclusion if age 65 or over and if AGI is under $28,500 (single) or AGI under $51,000 (married, filing jointly) |
|
Rhode Island |
AGI > $80,000 (single) These income threshholds begin with the 2016 tax year. |
|
Utah |
Tax credit rather than a deduction up to $450 (single) or $900 (married) if age 65 or over. Utah uses the federal PI formula plus state-specific additions to income. Residents under age 65 may also receive a tax credit under different rules. |
Federal taxes on Social Security can be withheld in advance. You'd need to estimate your income to calculate an accurate withholding amount.
- This information is not a substitute for that provided by the Social Security Administration.
- Via:
- https://personal.vanguard.com/us/insights/article/owe-social-security-a-112016?cmpgn=EXT:EM:RIG:SSV3:1216:RPM10:RPM10SS:Garticle:XX:XX
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