A common question that Taxsmith hears all the time is whether or not someone who receives Social Security (SSI) benefits is required to file a Federal tax return. Every year a SSA-1099 is issued to an individual who receives SSI. The form shows the total amount of benefits received for that year. Some common tips to determine whether or not someone who receives SSI is required to file a Federal tax return are…
ü Add one-half of the Social Security benefits you received to all your other income, including tax-exempt interest. Tax-exempt interest includes interest from state and municipal bonds.
ü Next, compare this total to the ‘base amount’ for your filing status. If the total is more than your base amount, then some of your benefits may be taxable.
ü The three 2012 base amounts are:
ü $25,000 for single, head of household, qualifying widow or widower with a dependent child or married individuals filing separately who did not live with their spouse at any time during the year;
ü $32,000 for married couples filing jointly; and
ü $0 for married persons filing separately who lived together at any time during the year.
Taxsmith tax attorneys are here to answer any tax related questions. If you have questions please contact us at 888.741.0272 or at firstname.lastname@example.org.