Social Security Tips To Avoid Income Tax Surprises
Many seniors are surprised to find out that their Social Security benefits are taxable, and the bill can be significant. The amount that is taxable for an individual earning $25K to $34K is 50%, while if you make more than $34K then 85% of your benefits are probably taxable. What to do when you don’t want a surprise come April 15 is to fill out Form W-4V with The Social Security Administration requesting an amount to be withheld for taxes. The choices are 7%, 10%, 12% and 22%. These percentages apply to the full income, not the 50% or 85% that is taxable.   Most states, including California, do not tax Social Security income.