5 Ways to Avoid Taxes on Your Social Security Benefits

From the Kiplinger Magazine website

Whether your Social Security benefits are taxed depends on your “provisional income.” Your provisional income is your adjusted gross income, not counting Social Security benefits, plus nontaxable interest and half of your Social Security benefits.

If it’s below $25,000 and you file taxes as single or head of household, or less than $32,000 if you file a joint return, you won’t owe taxes on your benefits. If your provisional income is between $25,000 and $34,000 if you’re single, or between $32,000 and $44,000 if you file jointly, up to 50% of your benefits may be taxable. If your provisional income is more than $34,000 if single or more than $44,000 if married filing jointly, up to 85% of your Social Security benefits may be taxable.

For more information about the tax rules for Social Security benefits, see Taxes on Social Security Can Be a Costly Retirement Surprise.

A few strategies can help you keep your income below the cutoffs and reduce the portion of your benefits that is taxable.

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