There are five simple steps that you can take to reduce (or even ELIMINATE) the taxes on Social Security.
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⭐⚠️⭐Please read this⭐⚠️⭐
I am an actual practicing financial planner, but I’m not YOUR financial planner. Don’t take what I say as specific advice for your situation. Please consult with your own tax, legal and financial advisors.
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⚠️I am not an attorney or SSDI advocate. Furthermore, since I don’t really know you, I can’t give you advice. Please don’t take this video as specific advice for your specific situation. Consult your own tax, legal and financial advisors.
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How To Get TAX FREE Social Security — 5 Simple Strategies You Should Know
Social Security benefits are an essential source of retirement income for millions of Americans. However, many recipients are unaware that they may owe taxes on their Social Security benefits. Fortunately, there are strategies available to help you minimize or even eliminate the tax on your Social Security income. Here are 5 simple strategies that you should know to potentially receive tax-free Social Security benefits.
1. Understand the taxable threshold:
The first step in achieving tax-free Social Security benefits is to understand how much of your benefit is subject to taxation. This starts by calculating your provisional income, which includes 50% of your Social Security benefits, all taxable income, and tax-exempt interest. If your provisional income exceeds a certain threshold – $25,000 for single filers and $32,000 for joint filers – up to 85% of your Social Security benefit may be subject to taxation. By keeping your provisional income below these thresholds, you can minimize or eliminate taxes on your benefits.
2. Control your taxable income:
One effective strategy to reduce your provisional income is to control your taxable income. Consider withdrawing funds from tax-free accounts such as Roth IRAs or cash value life insurance policies. By leveraging these sources, you can minimize the taxable income and potentially keep your provisional income below the thresholds. Additionally, by deferring income until after reaching your full retirement age, you can reduce your provisional income and the potential tax burden.
3. Utilize the “File and Suspend” strategy:
For married couples, a popular strategy known as “File and Suspend” can help minimize taxes on Social Security income. This strategy allows the higher-earning spouse to file for Social Security benefits at full retirement age but suspend receiving them. This action enables the lower-earning spouse to file a restricted application for spousal benefits, allowing them to receive benefits while their own Social Security continues to grow. By doing so, you can potentially reduce taxes on your benefits while maximizing your overall Social Security income.
4. Consider tax-efficient investments:
Choosing tax-efficient investments can help minimize your overall taxable income. This includes investing in municipal bonds or tax-managed funds that generate dividends and capital gains that are free from federal taxes. By incorporating these types of investments into your retirement portfolio, you can reduce your taxable income and potentially qualify for tax-free Social Security benefits.
5. Plan your withdrawals strategically:
Coordinating your withdrawals from different retirement accounts can help optimize your tax situation and potentially eliminate taxes on your Social Security benefits. By withdrawing funds from taxable accounts first, such as traditional IRAs or 401(k)s, you can reduce your provisional income. This approach allows you to delay taking Social Security benefits until a later age when you may receive a higher monthly benefit, resulting in a smaller portion of your benefits being subject to taxation.
In conclusion, by understanding the taxable threshold, controlling your taxable income, utilizing strategies like “File and Suspend,” considering tax-efficient investments, and planning your withdrawals strategically, you can potentially achieve tax-free Social Security benefits. It is essential, however, to consult with a qualified financial advisor or tax professional to determine the most suitable strategy based on your specific circumstances. With the right planning and knowledge, you can make the most of your Social Security benefits while minimizing your tax liability.
Good Lord. SSI is a tax in the first place. Its criminal SSI is taxed as income.
The very idea of taxing Social Security is outrageous. It wasn't taxed until Reagan – the President who began the all out assault on the working class both before and after retirement.
Yep. I'm 67, retired, but not planning to collect social until age 70. So, since I have no other taxable income coming in, I'm currently actively converting from a regular IRA to a ROTH IRA every year until age 70.
Really powerful tools to consider at the appropriate time. No telling how the law may change before I plan to claim in a dozen years given the current state of the SS trust fund.
When married filing jointly with pensions, interest and social security (gross annual) combined exceeds $118,100, will AMT apply? Or does AMT contemplate only the 50% (or 85%) taxable portion of social security?
That’s just 1 thing, 70 is pretty old, and we should enjoy our money and not wait until we are old to use it.
It’s just suck that SS is taxed at all, it should be based on income below $100,000 per year. NYC is expensive, and we need 40k per year + more for travel.
This video is obviously only for wealthy seniors. With $7000/mo you could live like a king. He makes it sound like they'll be in due straits. Don't worry about taxes, eliminate unnecessary expenses. Don't own so much that isn't paid for.
the government would greatly increase the tax dollar by implementing a flat tax of 15% on every dollar made including the multibillion-dollar business the ones who pay just 1% on earnings when the income workers are paying up to 23% in income taxes.
Item 3. If you have no gains I would just sell 3k worth of losses, especially if you think the stock will recover.
I am on Social Security disability and SSI and I have never had to worry about paying any taxes because my income is so low. Is this something I'm going to have to worry about in the near future?
I’m a 69 year old retired veteran. I receive retirement pension, social security and disability is there an age where I would stop paying taxes. Oh yes my. Wife is younger but only makes 20k a year.
I like this channel, its very informative but, I dont know anyone who makes the kind of money that is talked about here.
After a life of work with a bunch of worn out joints Ive found that when I finally give it up at 64.5 I will be signing up for congressionally mandated poverty.
I have my retirement from the Airforce set at $1,180 – 10 % (VA) which is non-taxable = 1,027.36 currently, then i would have Social Security, accuring a FERS pension to be $453 monthly in Jan23 i am 62 and still working in FERS
I am confused about this topic. I have seen that pensions do not count towards social security taxes. Then i saw pesions were accumulated together to determine social security earned income limits? Are pensions added with social security income to determine this threshhold or not
Get real man, 90 % of us do not have that kind of money
Devin, question is do we have to pay into medicare which is subtracted from SSN?
I was considering donating a museum but I need to know how this would be filed on taxes. Let's say if the items are over $100,000.00 how much can you claim on taxes? Since the items are not cash donations would I use the receipt from an appraisal?
Info incomplete in delaying until 70 yo. What about the money collected for 3 years 3000 x 36 = $108,000 you could have invested on good index?
I THINK YOU SHOULDNT HAVE TO PAY TAXES AFTER YOU RETIRE SINCE YOU HAVE PAID ALL YOUR ADULT LIFE….I KNOW.. UNICORNS IN THE BACK YARD FARTING RAINBOWS…
In terms of reducing social security taxation. I assume SSN obtains your IRS Form 1040 information to see your adjusted gross income. If so, how far back does SSN look at your IRS Form 1040, to calculate your SSN taxation?
The ignorance of our forefathers or who ever allowed for Uncle Sam take your wages & make no promise or guarantee you will get any of it back. Then the insurance that you need at that age you have to wait 2 years & pay for parts as add ons. No authority in the investments made or the ability to reclaim lost wages. But the over the top tactic of TAXES I paid with my earnings on paycheck for my labor already, but it is taxed again. How about you give we the people options being the fact it is our wages & without our labor you would not exist. No one can take your wages without written consent, I didn't sign up for this, I want out!
Just think the latest pay increase for congressional staffers tops out at over 250,000 per month. Wow great work if you can get it. It however shows how out of touch they are from the fly over region of the US.
I retired a year-and-a-half ago, but I haven't filed for SS yet. My full retirement age will be coming up in a few months.
The first strategy that you suggested was to use money from tax-delyed accounts BEFORE filing for SS. That was your clearest advice to lower SS taxes, and probably the ONLY strategy that I currently have available.
my hubby is actually making more retired than when he was working, as he was in a union.
Interesting how we pay a Tax all our working life and then receive those supposed benefits only to be taxed Again! Our system SUCKS!!!!!
I take 2 pensions, plus ss this doesn't help me
Most people only make about 30k per year. Saving every dime put away 250k if the stock market doesn't crash. How about a real example for the working stiffs? It's going to be incredibly tight if I work to 70. My FRA is 66.6.
We owed federal taxes this year on my husband's social security. I found it very interesting when we signed into his SS account that there was no option (that I could find) to actually have taxes taken out each month.
The SCAMMERS target this channel
So when my pay check was taxed originally, now I'm taxed again. Like when I bought my house I am still paying tax on it and yet they raised my property tax in this economy by 33%?!! Are they insane!@!
In the first example you say to wait 3 years to take SS. That will be a 3 year loss of $108,000!! When you turn 70 you will gain $720 a month and that will take you 12.5 YEARS to make up!! You will be (if you live that long) 82.5 yrs old just to break even and that does not include investing any of that SS money which would take you even longer to break even! This seems like the worst advice ever!! Especially if one takes into account what could happen to SS in the future(bankrupt?)
Good Afternoon, Does military retirement count towards provisional income?
So simple. By your first example all I have to do is work three more years and sacrifice my quality of life, potentially lowering my life expectancy due to stress in the workplace. Genius.
OK, give my retirement to a church or my daughters/sons ??? G my grand kids will enjoy it. The church does not need it as a tax payers with bills to pay would..
Good, practical advice Devin, that piques my interest. You consistently recommend folks to sit down with a tax advisor for these strategies. I would be interested to know if any of the folks who say that none of this applied has met with a tax advisor. Thanks for your time!
very good video
Hi Devin, I'm already having volunteered taxes deducting from my Social Security Benefits.
35 years ago, I planned my retirement to live comfortable. The reality of what I had set up back then leaves me today to still counting every dollar. My dream of cruises and vacations has become just that, a dream. I thought I would be ahead of inflation.
IRS PUBLICATION 915 is helpful!