Taxes And Ssdi

[jackba57]

i was wondering why i pay taxes out of my SS but my buddy in pennsylvania with SSDI and 100% just like me does not??

Whats the ruling here and how is it decided? Did i miss something?

jack

[Railroader]

i was wondering why i pay taxes out of my SS but my buddy in pennsylvania with SSDI and 100% just like me does not??

Whats the ruling here and how is it decided? Did i miss something?

jack

-This is pretty simple if you follow the instructions. If your income is high enough then you can pay up to 85% of your social security or RRRetirement pension.

Social Security Benefits Worksheet—Lines 20a and 20b Keep for Your Records

Form 1040—Lines 20a and 20b

Before you begin: Complete Form 1040, lines 21 and 23 through 32, if they apply to you.

Figure any write-in adjustments to be entered on the dotted line next to line 36 (see the

instructions for line 36 on page 31).

If you are married filing separately and you lived apart from your spouse for all of 2007,

enter “D” to the right of the word “benefits” on line 20a.

Be sure you have read the Exception on page 24 to see if you can use this worksheet

instead of a publication to find out if any of your benefits are taxable.

1. Enter the total amount from box 5 of all your Forms SSA-1099 and

Forms RRB-1099. Also, enter this amount on Form 1040, line 20a . . . . . . 1.

2. Enter one-half of line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.

3. Enter the total of the amounts from Form 1040, lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17

through 19, and 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

4. Enter the amount, if any, from Form 1040, line 8b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.

5. Add lines 2, 3, and 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.

6. Enter the total of the amounts from Form 1040, lines 23 through 32, and any write-in adjustments

you entered on the dotted line next to line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

7. Is the amount on line 6 less than the amount on line 5?

No. STOP None of your social security benefits are taxable. Enter -0- on Form 1040, line

20b.

Yes. Subtract line 6 from line 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.

8. If you are:

• Married filing jointly, enter $32,000

• Single, head of household, qualifying widow(er), or married filing

separately and you lived apart from your spouse for all of 2007,

enter $25,000 }. . . . . . . . . . . . . . 8.

• Married filing separately and you lived with your spouse at any time

in 2007, skip lines 8 through 15; multiply line 7 by 85% (.85) and

enter the result on line 16. Then go to line 17

9. Is the amount on line 8 less than the amount on line 7?

No. STOP None of your social security benefits are taxable. Enter -0- on Form 1040, line

20b. If you are married filing separately and you lived apart from your spouse

for all of 2007, be sure you entered “D” to the right of the word “benefits” on

line 20a.

Yes. Subtract line 8 from line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.

10. Enter: $12,000 if married filing jointly; $9,000 if single, head of household, qualifying

widow(er), or married filing separately and you lived apart from your spouse for all of 2007 . . . 10.

11. Subtract line 10 from line 9. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.

12. Enter the smaller of line 9 or line 10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.

13. Enter one-half of line 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.

14. Enter the smaller of line 2 or line 13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.

15. Multiply line 11 by 85% (.85). If line 11 is zero, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.

16. Add lines 14 and 15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.

17. Multiply line 1 by 85% (.85) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.

18. Taxable social security benefits. Enter the smaller of line 16 or line 17. Also enter this amount

on Form 1040, line 20b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.

If any of your benefits are taxable for 2007 and they include a lump-sum benefit payment that was for an earlier

year, you may be able to reduce the taxable amount. See Pub. 915 for details.

TIP

- 25 -

[Railroader]

i was wondering why i pay taxes out of my SS but my buddy in pennsylvania with SSDI and 100% just like me does not??

Whats the ruling here and how is it decided? Did i miss something?

jack

You don't have to have taxes withheld from your SSDI but if you have Capital Gains,Dividends and Interest income then you may have to pay estimated taxes paid quarterly and if you don't then there may be a penalty and interest charged and it could be costly.