If I Receive A Pension And Social Security Are Both Taxed?
Receiving a pension and a social security benefits check can cause a person to have to deal with interesting tax questions. Most people would rather not deal with the Internal Revenue Service. The desire not to deal with the IRS comes long before a person needs to worry about any of the issues relating to retirement. It usually comes when a person needs to fill out his first income tax return. He finds out just how much of a pain the Internal Revenue Service actually is. Regardless of the problems and stress the IRS causes, a person with a pension and with social security may have to pay taxes on both.
When Does a Person Have to Pay Taxes on Social Security and a Pension?
Social security benefits will not be taxed for most people who have a pension. The limit for the taxation of pensions is slightly over $100,000 for a single person in 2011. Married couples have their pensions taxed if their income is over $120,000. The rules are designed to protect the poor, working and middle class individuals from having to shell out too much of their income. Retirees, especially, cannot expect pay raises that people still in the work force can.
Is there Someone Who Can Help Me Sort This Out?
The staff at the local social security office can help a retiree sort out the rules that are related to social security and pensions. They cannot offer advice on the finer points of tax law. A retiree who does not know if he will have to pay taxes or not should consult an account or an attorney who specializes in these matters. The lawyer and the accountant will know information that the staff of the social security office will not. At least this is true in most cases.