How much is deducted from Social Security payment - taxes withheld before or after receiving check?

Taxes aren't automatically withheld from your Social Security benefits unless you specifically request it. The amount shown on your benefit estimate is the gross amount before any deductions. You have options: 1. Receive full amount and pay taxes quarterly or annually 2. File Form W-4V to request voluntary tax withholding (at 7%, 10%, 12%, or 22%) 3. Have Medicare Part B premium deducted (and Part D if applicable) Other possible deductions include Medicare Advantage premiums, any garnishments for things like unpaid federal taxes, child support, or student loans. Also, depending on your combined income, up to 85% of your benefits may be taxable.

my wife gets hers with 10% taken out for taxes and it works good for us. the medicare comes out too. better than owing a big bill at tax time!!

Keep in mind that whether your SS benefits are taxed depends on your "combined income" - which is your adjusted gross income + nontaxable interest + 1/2 of Social Security benefits. If filing single and combined income is: - Below $25,000: No tax on benefits - $25,000-$34,000: Up to 50% taxable - Above $34,000: Up to 85% taxable For married filing jointly, the thresholds are $32,000 and $44,000. If you have other income sources in retirement, you'll likely need to pay some tax on your SS benefits. The W-4V form lets you choose 7%, 10%, 12% or 22% withholding rates.

I see some confusion about tax withholding from Social Security benefits. Let me clarify: 1. The benefit amount shown on your statement is the gross amount before ANY deductions 2. Federal tax withholding is OPTIONAL - you must request it by submitting Form W-4V 3. Medicare Part B premium (currently $174.70/month for most people in 2023) is automatically deducted when you enroll in Medicare 4. If you have higher income ($97,000+ for individuals), you'll pay extra for Medicare (IRMAA surcharges) 5. Some states also tax Social Security benefits For accurate planning, estimate your total retirement income, determine what percentage might be taxable, then decide if voluntary withholding makes sense for your situation.

Just wondering - has anyone successfully reached SSA to ask these kinds of tax questions? I've been trying for WEEKS and can't get through to anyone who can help with my withholding form.

Just want to add something important that others haven't mentioned - if you're still working when you claim Social Security at 66 (before your FRA of 67), you'll be subject to the earnings limit. For 2023, that's $21,240 annually. They'll deduct $1 for every $2 you earn above that limit, which is a significant reduction that will show up as a deduction from your monthly payment. This is separate from the tax issue but important for accurate budgeting.

i was SHOCKED when i started getting ss and saw all the deductions!! nobody tells you this stuff beforehand!! between medicare and the tax withholding i chose, i get WAAAY less than what my statement said. budget accordingly!!!!

my brother just turned 66 and he didn't do the withholding thing and now owes a big tax bill he can't pay. definitely do the withholding!!!

As someone who just went through this process last year, I can confirm what others have said - the benefit estimate is the gross amount before deductions. Here's what I wish I had known: 1. Start with your benefit estimate, then subtract Medicare Part B ($174.70/month in 2024) 2. If you choose tax withholding, that comes out too - I went with 10% and it's been manageable 3. Don't forget about state taxes if your state taxes SS benefits One tip: you can change your withholding election at any time during the year by submitting a new W-4V form. I started with 7% withholding but bumped it to 10% after my first quarterly estimated tax payment was higher than expected. The SSA's online portal makes it pretty easy to track your actual payments and see the breakdown of deductions once you start receiving benefits. Good luck with your retirement planning!

As a newcomer to this community, I want to thank everyone for this incredibly detailed discussion! I'm 64 and planning to claim at 67, so I have some time to prepare, but reading through all these real-world experiences has been invaluable. One thing I'd like to add that might help others - I recently discovered that you can actually view a sample Medicare & You handbook on Medicare.gov before you turn 65. It breaks down all the different parts, premiums, and coverage options in detail. This helped me better understand what those Medicare deductions will look like and plan accordingly. Also, for those mentioning the complexity of tax calculations with Social Security benefits, I found that many tax software programs now have specific sections for Social Security taxation that walk you through the "combined income" calculations. TurboTax and TaxAct both have good SS benefit modules that might help with planning. Quick question for those already receiving benefits: Do you get any advance notice from SSA about changes to deductions (like Medicare premium increases), or do they just show up in your payment with little warning? I'm trying to understand how much advance planning I can do versus needing to adjust on the fly. Thanks again for creating such a helpful resource for those of us navigating retirement planning!