Whether you pay taxes on Social Security depends on your total income, not just what you receive from Social Security
You may owe federal income tax on your Social Security benefits if your combined income exceeds certain thresholds. Combined income means your adjusted gross income plus nontaxable interest plus half of your Social Security benefits. The IRS uses this combined income figure — not your benefit amount alone — to decide if any of your benefits are taxable.
The thresholds are $25,000 for single filers and $32,000 for married couples filing jointly. If your combined income falls below these amounts, you owe no federal tax on your benefits. If it exceeds them, you may owe tax on up to 85 percent of your benefits, depending on how far over the threshold you go.
Some states also tax Social Security benefits, though most do not. The states that tax benefits are Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, and Vermont — and even in these states, exemptions or lower tax rates often explore to people over a certain age or with income below a certain level.
Key Takeaways
- The IRS calculates whether your benefits are taxable using combined income (your income plus half your benefits), not your benefit amount alone.
- If your combined income is below $25,000 (single) or $32,000 (married filing jointly), you owe no federal tax on your benefits.
- If your combined income exceeds the threshold, between 50 and 85 percent of your benefits may be subject to federal income tax.
- Eleven states tax Social Security benefits, though most offer exemptions based on age or income level.
How the IRS calculates combined income
Combined income is not the same as your total income. The IRS adds three things together: your adjusted gross income (AGI), any nontaxable interest you earned, and half of your Social Security benefits for the year.
If you have wages from work, self-employment income, pension income, or taxable interest and dividends, those all count toward your AGI. Nontaxable interest — typically from municipal bonds — is added back in. Then the IRS adds half your annual Social Security benefit amount, even though that half is not actually income you received.
For example, if you received $20,000 in Social Security benefits, had $10,000 in pension income, and $2,000 in nontaxable interest, your combined income would be $10,000 + $2,000 + ($20,000 × 0.5) = $22,000. This combined income figure determines whether any of your benefits are taxable.
The two income thresholds and how much is taxable
The IRS uses two thresholds to determine how much of your benefits, if any, are taxable. The first threshold is $25,000 for single filers, $32,000 for married couples filing jointly, and $0 for married couples filing separately. If your combined income is at or below the first threshold, none of your benefits are taxable.
If your combined income exceeds the first threshold but stays below the second threshold ($34,000 for single filers, $44,000 for married filing jointly), up to 50 percent of your benefits may be taxable. The amount depends on how far over the first threshold you go.
If your combined income exceeds the second threshold, up to 85 percent of your benefits may be taxable. Again, the exact percentage depends on your specific combined income. The IRS worksheet in Publication 915 walks through the calculation, or you can ask a tax preparer to compute it for you.
State taxes on Social Security benefits
Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, and Vermont all tax Social Security benefits at the state level. However, most of these states offer partial or full exemptions.
Common exemptions include age-based breaks (often for people 55 or older), income-based breaks (benefits are exempt if your income falls below a certain level), or exemptions for people receiving disability benefits. Connecticut, for instance, exempts benefits for people over 55. Kansas exempts all Social Security benefits. Missouri taxes benefits but exempts people over 62.
If you live in one of these states, check your state tax authority's website or contact them directly to learn what exemptions explore to your situation. State rules change periodically, and your state may have updated its rules since the last time you filed.
How to report Social Security income on your tax return
Social Security benefits appear on Form SSA-1099, which you receive by January 31 each year. This form shows the total benefits you received in the previous year. You report this amount on your federal tax return using Form 1040 and Schedule 1 (or Form 1040-SR if you are 65 or older).
You do not report the full benefit amount as taxable income. Instead, you use the IRS worksheet in Publication 915 to calculate how much, if any, of your benefits are taxable based on your combined income. Only the taxable portion goes on your return as income.
If you file jointly with a spouse, both of your benefits and both of your incomes factor into the combined income calculation. If you are married filing separately, the threshold drops to $0, meaning any combined income at all may trigger taxation of your benefits.
Withholding taxes from your Social Security check
If you know your benefits will be taxable, you can ask Social Security to withhold federal income tax from your monthly check. You do this by completing Form W-4V and submitting it to Social Security. You choose the withholding rate: 7 percent, 10 percent, 12 percent, or 22 percent of your benefit amount.
Withholding is optional, but it can help you avoid owing a large tax bill at the end of the year. If you do not withhold and owe taxes, you may also owe penalties and interest if your tax liability is substantial.
You can change your withholding at any time by submitting a new Form W-4V to Social Security. If you want to stop withholding, you can do that too — just submit a new form indicating zero withholding.
What happens if you work while receiving Social Security
If you are under full retirement age and working, your earned wages count toward your combined income for tax purposes. This means working can push your combined income over the threshold and make your benefits taxable, even if the work income itself is modest.
Additionally, if you earn more than $23,400 in 2024 (this amount changes yearly) before reaching full retirement age, Social Security reduces your benefits by $1 for every $2 you earn above that limit. This reduction is separate from taxation — it is a benefit reduction applied by Social Security itself.
Once you reach full retirement age, there is no earnings limit, and your work income does not reduce your benefits. However, your work income still counts toward combined income for tax purposes, so it can still make your benefits taxable.
Frequently Asked Questions
Can I reduce my taxes by spreading my income across two years?
No. Your combined income is calculated for each tax year separately. You cannot defer Social Security benefits or income to a different year to lower your tax burden. However, you can manage when you claim benefits in the first place — claiming later results in higher monthly benefits, which may or may not result in more total tax depending on your other income sources.
If I have no other income, do I owe taxes on Social Security?
No. If Social Security is your only income source, your combined income will be below the threshold, and none of your benefits are taxable. You would owe no federal income tax. State taxes may still explore depending on where you live.
What if I receive both Social Security and SSI?
SSI (Supplemental Security Income) is not counted in the combined income calculation for federal tax purposes. Only Social Security retirement, survivor, and disability benefits count. However, SSI itself is not taxable income, so receiving both does not create a tax liability on the SSI portion.
Do I have to file a tax return if my only income is Social Security?
Generally, no — if Social Security is your only income and none of it is taxable, you do not have to file a federal return. However, if you have other income or if you want a refund of withheld taxes, you should file even if you are not required to.
How do I know if my state taxes Social Security?
Check your state's tax authority website or call their helpline. Most states do not tax Social Security at all. The eleven that do often have exemptions based on age or income, so even if your state taxes benefits, you may not owe state tax depending on your situation.