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Merlo
Merlo, Accountant
Category: Tax
Satisfied Customers: 9783
Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
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DO SENIOR CITIZENS OVER 65 HAVE TO FILE A TAX RETURN IF THEIR

Customer Question

DO SENIOR CITIZENS OVER 65 HAVE TO FILE A TAX RETURN IF THEIR INCOME IS LESS THAN
$25,000?

IS SOCIAL SECURITY INCOME TAXABLE?
Submitted: 4 years ago.
Category: Tax
Expert:  Marvin,EA replied 4 years ago.
Hello and thank you for using Just Answer. If you are single and have taxable income over $10,300 for 2008 you must file a federal income tax return. A person age does not matter only income.
Customer: replied 4 years ago.
This is not the answer I have had from many other experts in the field. If this is correct when did the law change?

What do you mean my payment and bonus may be tax deductible?
Expert:  Merlo replied 4 years ago.
Hello Sal,

I see that your question was not really addressed entirely, so here is some additional information that may help you.

As Marvin said, age is not a factor in determining whether or not you file a tax return. It is the amount of taxable income that you have for the year. If you file your return as a single person, then as long as your taxable income does not exceed $10,750, you are not required to file a return. If you file a joint return with your spouse, and if you are both over the age of 65, then you are not required to file a return unless your taxable income exceeds $20,900 for the year.

If your only income is from Social Security, then none of that income is taxable, and you are not required to file a return. If you have income from other sources, then depending on the amount of that other income, part of your SS benefits may become subject to tax.

When you receive SS benefits, you are allowed to have only a certain amount of other income before part of your SS benefits may also need to be included in your taxable income. There is a worksheet which you need to fill out that determines how much, if any, of your SS benefits are subject to tax. The basis formula works like this:

If you are a single person, then SS allows you a base of $25,000. If you are married filing a joint return, then SS allows you a base of $32,000. What you need to do is take half of the SS benefits you receive for the year and deduct that amount from your allowed base. The difference is what you are allowed to have in other income before part of your benefits are subject to tax. If your other income exceeds the allowed amount, then you would need to complete the worksheet to determine how much of your SS benefits need to be included in your taxable income.

Here is an example of how this works. If you are a single person, SS allows you a base of $25,000. Let’s say that you receive SS benefits of $20,000 per year. You would take half of that amount ($10,000) and subtract that from your allowed base of $25,000. The result which is $15,000 is what you are allowed to have in other income before any of your SS benefits would be subject to tax. So in this example, if you were receiving $20,000 in SS benefits each year and another $20,000 in benefits from a private retirement plan, that means that your private retirement income exceeds your allowed income of $15,000, and you would need to complete the SS worksheet to see how much of your SS benefits need to be included in your taxable income.

I am giving you a link here to the SS worksheet which will help you determine if any of your SS benefits are subject to tax. If you have trouble filling out this worksheet and need some help, I will be happy to help you with this, but would need additional information. I would need to know your filing status (single or married), the age of both you and your spouse if you are married, the total amount that you receive from SS and the total amount you receive from other sources.

http://www.completetax.com/taxguide/tools/downloads/08-ssbenefits(1040).pdf

If this was helpful please press the Accept button. Positive feedback is also appreciated.

Thank you Sal, and let me know if you have more questions. I am happy to help you with whatever I can.



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