Taxes on benefits

Is Your Social Security Taxable? The Income Line That Decides It

• As of October 10, 2026
• By Ask Margaret, reviewed by a person
• Margaret is an AI presenter

Up to 85% of your Social Security can be taxed. Whether yours is depends on one income line, and most people have never calculated it. This guide walks through what that line is, the two income limits the IRS uses, what pushes people over them, and five ways to keep more of your check. It follows the video of the same name.

First, a myth: 85% is not a tax rate

85% means up to 85% of your benefits can be counted as taxable income. Then your normal tax bracket applies to that part. Nobody hands 85% of their check to the IRS, and many people with modest income pay no federal tax on their benefits at all. So the real question is how much income the IRS counts. That number is called combined income.

How to work out your combined income

The IRS builds combined income from three parts. You can work it out at the kitchen table.

1. Your adjusted gross income. That includes pensions, wages, and money you take out of a traditional IRA or 401k. It also includes interest, dividends, and capital gains.
2. Tax-exempt interest, such as interest from municipal bonds.
3. Half of the Social Security benefits you got for the year.

Add those three parts together. The total is your combined income, and it is the one line this whole topic turns on.

One part surprises a lot of people. Tax-exempt interest is not taxed by itself, but it still counts toward your combined income. The IRS worksheet tells you to include it. So a big municipal bond fund can quietly push more of your Social Security into tax. If you own one, ask your preparer to show you this line.

The income lines

The Social Security income lines are $25,000 for a single filer and $32,000 for a married couple filing jointly. Below your line, the IRS does not tax your benefits.

Married couples filing jointly get higher lines, but not double. Half of both spouses' benefits go into the math. One more line catches couples off guard: if you are married, file separately, and lived together at any point in the year, your line is $0.

A made-up example

This is an example for a single filer, not an official figure. Say your Social Security adds up to $24,000 a year. Only half of that goes into the math, so that is $12,000. Now say you also get a pension of $20,000 a year. Add them, and your combined income is $32,000. There is no other income in this example.

That $32,000 is over the single line of $25,000. It is under $34,000. So this person sits in the middle band. In the middle band, the taxable part is the smaller of two amounts. One is half of the benefits, $12,000 here. The other is half of the amount over the line. In this example, that amount is $7,000, and half of it is $3,500. That $3,500 counts as taxable income. The rest of the benefits stays tax free.

What pushes people over the line

Social Security can become taxable in a year when nothing in your life changed. Three things usually cause it.

Time. The $25,000 and $32,000 lines are not adjusted for inflation. Your benefits get a raise most years, but the lines stay put. So each raise moves you a little closer to your line, even if nothing else changes. Social Security is scheduled to announce the 2027 cost of living raise on October 14. Estimates put it between 3.5% and 3.6%, and it is not final until that day. A raise is good news. Just know it also grows the half of your benefits that counts toward your line.

One big withdrawal in a single year. Money you take out of a traditional IRA or 401k counts in full. So does a capital gain when you sell stocks or a fund. Say you take $15,000 extra one year for a new roof. In our example, that pushes combined income to $47,000. That is past the $34,000 line, and now up to 85% of the benefits can count as income.

Going back to work part time. Wages from a part-time job count toward the line, just like a pension does.

Five ways to keep more of your check

Move one: find your real number. Each year, Social Security sends you a tax form called SSA-1099. On that form, Box 5 shows your net benefits for the year. Take half of that amount. Then add your other income and any tax-exempt interest. Compare the total to your line. Now you know exactly where you stand.

Move two: spread out big withdrawals. Two medium years can cost less than one huge year. If you know a big expense is coming, plan it before you pull the money, and talk to a tax preparer first. Sometimes splitting a withdrawal across December and January puts it in two tax years. That can keep one year under your line, or at least in a lower band. The same idea works for selling investments.

Move three: know that Roth money works differently. Qualified withdrawals from a Roth IRA do not count toward this income line. A traditional IRA withdrawal does. So if you have both kinds of accounts, the order you draw from matters. In a year when you are close to your line, Roth money may keep you under it.

Move four: claim the new senior deduction, and know what it does not do. If you are 65 or older, there is an extra $6,000 deduction for you. It runs for tax years 2025 through 2028. A married couple who both qualify can get $12,000. You can take it even if you do not itemize. It shrinks above $75,000 of income, or $150,000 for joint filers. It lowers your taxable income, but it does not erase the $25,000 and $32,000 lines. Your benefits can still be taxable above them.

Move five: avoid a surprise tax bill. You can ask Social Security to hold back federal tax from each check. The form is called W-4V. The lower choices are 7% and 10% of each payment. The higher choices are 12% and 22%. Give the form to Social Security, not to the IRS. Then the tax gets paid a little at a time.

Your state may tax it too

Federal tax is not the whole story. For 2026, 8 states tax Social Security benefits: Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah and Vermont. Most of them exempt some or all benefits below an income level. West Virginia finished phasing out its tax this year, so its retirees no longer pay it.

Your homework this week

Find Box 5 on your SSA-1099. Take half, then add your other income. Compare it to $25,000 if you file single, or $32,000 if you file jointly. If you are close, plan your withdrawals and think about withholding.

Sources

General education only, not financial, tax, legal or medical advice. Your situation may differ. Not affiliated with the Social Security Administration. Check your own record at ssa.gov/myaccount. Tax rules depend on your situation; consult a tax professional or irs.gov. Talk with a licensed financial professional before making financial decisions.

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