Are You Overpaying Taxes on Social Security? Here’s How to Reduce the Bill
From Yahoo Finance: 2025-03-22 08:30:00
Millions of Americans rely on Social Security benefits for retirement income, but up to 85% of these benefits are subject to federal income tax. Delaying claims and reducing traditional IRA withdrawals are popular ways to lower taxes. Consult a financial advisor for personalized strategies to minimize tax bills on Social Security benefits.
To determine if your Social Security benefits are taxable, calculate your combined income, which includes Adjusted Gross Income, nontaxable interest, and half of Social Security benefits. Single filers with combined income above $25,000, and married joint filers above $32,000, may pay taxes on up to 85% of their benefits.
While Social Security benefits are taxed, they are subject to lower rates than other income sources, making them valuable for retirees. Strategies like Roth conversions and delaying Social Security can reduce tax burdens. Consult a financial advisor for personalized advice on managing retirement income and taxes effectively.
Consider delaying Social Security benefits until age 70 to reduce taxable income and maximize benefit checks. Roth IRA conversions can also minimize tax burdens by allowing tax-free withdrawals. Consult with a financial advisor to tailor tax-saving strategies to your specific situation.
Plan strategically to minimize taxes on Social Security benefits. Roth IRA conversions, delaying Social Security, and other techniques can lower tax burdens. Consult a financial advisor for personalized advice on optimizing your retirement income and reducing tax liabilities effectively.
Before making any financial decisions, consult a financial advisor to evaluate your specific situation. Various strategies can reduce taxes on Social Security benefits, but state taxes and individual circumstances may impact the effectiveness of these tactics. Consult with a financial advisor for personalized advice on managing retirement income and taxes.
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