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Thread: IRS Tax Question

  1. #1
    Senior Member cbdives's Avatar
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    IRS Tax Question

    Hello Everyone....any Tax experts?

    I am 62 years old. I receive a government pension and SSDI. Combined income is over $32,000. Is all my SSDI taxable?

    Turbo tax treats it that way

    Thanks

    Joe

  2. #2
    Senior Member rdf's Avatar
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    This might help.

    http://www.socialsecuritydisability....yments-taxable
    Quote Originally Posted by cbdives View Post
    Hello Everyone....any Tax experts?

    I am 62 years old. I receive a government pension and SSDI. Combined income is over $32,000. Is all my SSDI taxable?

    Turbo tax treats it that way

    Thanks

    Joe
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  3. #3
    Senior Member cbdives's Avatar
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    Thanks...apparently the ruling isn't too clear...I've been on hold with IRS 30 minutes waiting for a ruling

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    Senior Member Foolish Old's Avatar
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    Quote Originally Posted by cbdives View Post
    Thanks...apparently the ruling isn't too clear...I've been on hold with IRS 30 minutes waiting for a ruling
    The bad news is that the fine print says that you can't rely on the answer that you get from the IRS.
    Foolish

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  5. #5
    Senior Member rdf's Avatar
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    I was told something different than the link provides by a CPA I know. She said, if I remember correctly, that you add up all your income including 1/2 of your SSDI, and if that amount is less than 25K, you don't need to file or pay taxes on SSDI income.

    So who knows, I hope you get a response from IRS soon.
    Quote Originally Posted by cbdives View Post
    Thanks...apparently the ruling isn't too clear...I've been on hold with IRS 30 minutes waiting for a ruling
    ETA: Here's an example. http://www.mcandrewslaw.com/article_...-benefits.html
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  6. #6

    Internal Revenue Service

    Social Security Disability Income is not taxable but your government pension portion maybe subject to taxing.

    Ti
    "We must overcome difficulties rather than being overcome by difficulties."

  7. #7
    Senior Member rdf's Avatar
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    That's incorrect in some circumstances, as I laid out above.
    Quote Originally Posted by titanium4motion View Post
    Social Security Disability Income is not taxable but your government pension portion maybe subject to taxing.

    Ti
    To determine when the SSDI recipient should pay taxes on her benefits, the IRS adds one-half of a beneficiary's yearly SSDI award to her adjusted gross income (including tax-exempt interest payments). This figure is compared to a "base amount," and if it exceeds that base, then some of the beneficiary's SSDI award will be taxed. For single people, or married people filing separately who have lived apart for the entire year, the base amount is $25,000. Married couples filing jointly have a base amount of $32,000, and a married person who is filing separately but lived with her spouse for even a limited time has a base amount of $0 (this is not a misprint).

    Here are some examples of how this works in practice. Let's say that Mary, a single woman, received $10,000 in SSDI benefits and $21,000 in taxable income from an annuity. Since one-half of Mary's SSDI benefit, plus her $21,000 in other income, is greater than her base amount of $25,000, a portion of Mary's SSDI benefit will be subject to federal income taxation. Now let's look at Joe and Barbara, a married couple living together and filing a joint tax return. Joe received a $10,000 SSDI benefit and Barbara earned $25,000 from work. When one-half of Joe's SSDI benefit is combined with Barbara's income, they are $2,000 below their base amount of $32,000, which means that none of Joe's SSDI benefit will be taxed.

    If SSDI benefits are subject to tax, what portion of them is taxable? The short answer is either half of them or 85 percent of them, depending on income. If one-half of a single person's benefit plus the rest of her income is less than $34,000 (this threshold is $44,000 for a married couple filing jointly) then only 50 percent of her SSDI benefit will be taxed. If a beneficiary's income plus one-half of her benefit exceeds these thresholds, then 85 percent of the benefit is taxable.

    http://www.mcandrewslaw.com/article_...-benefits.html
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  8. #8
    Senior Member trekker6's Avatar
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    You should have minimal taxes if any, is most of your income from the pension? I use turbotax and it sees the ssdi and taxes it minimally, when you enter the ssdi, you enter it under the social security tab and not as income right?
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