FAQ's
Q: Why should a retiree choose to Postpone collecting Social Security?
A: Social Security Benefits collected at Full Retirement Age are about 30% higher than those collected at 62 and postponing each year past Full Retirement Age, can equate to about a 7% annual increase in benefits collected up to the maximum at age 70.
Q: How is Full Retirement Age determined?
A: Social Security determines Full Retirement Age on Year of Birth.
Q: Where can a Retiree obtain an official estimate of Social Security Benefits?
A: A Retiree can obtain an official estimate of Social Security Benefit at Full Retirement Age by visiting the Social Security Administration website .
Q: Are Social Security Benefits reduced if I collect and continue to work?
A: Yes, If you are between the ages of 62 and your Full Retirement Age, Social Security Benefits are reduced $1 for every $2 earned over the $14,640 Earned Income Exemption of (2012). During the year you reach your Full Retirement Age, Benefits are reduced $1 for every $3 earned over the $38,880 Earned Income Exemption of (2012). Once you reach your Full Retirement Age Social Security Benefits are no longer reduced if you work.
Q: Are Social Security Benefits Subject to Federal Income Tax?
A: Yes, depending on total income and marital status. (see chart below)
|
Taxpayer Filing Status |
Provisional Income Threshold |
Benefits Subject to Income Tax |
|
Under $25,000 |
0% |
|
|
$25,000 - $33,999 |
up to 50% |
|
|
$34,000 or more |
up to 85% |
|
|
Under $32,000 |
0% |
|
|
$32,000 - $43,999 |
up to 50% |
|
|
$44,000 or more |
up to 85% |
|
|
$0 or more |
up to 85% |
Q: What are the 2011 Federal Income Tax Rates
A: See the table below.
Unmarried Individual Returns
Taxable Income
|
Tax + % on Excess |
Of the Amount Over
|
|
$0 8,500 |
$0 10% |
$0 |
|
8,500 34,500 |
850 15% |
8,500 |
|
34,500 83,600 |
4,750 25% |
34,500 |
|
83,600 174,400 |
17,025 28% |
83,600 |
|
174,400 379,150 |
42,449 33% |
174,400 |
|
379,150 ………………. |
110,017 35% |
379,150 |
Joint Retuns
Taxable Income
|
Tax + % on Excess |
Of the Amount Over
|
|
$0 17,000 |
$0 10% |
$0 |
|
17,000 69,000 |
1,700 15% |
17,000 |
|
69,000 139,350 |
9,500 25% |
69,000 |
|
139,350 212,300 |
27,088 28% |
139,350 |
|
212,300 379,150 |
47,514 33% |
212,300 |
|
379,150……………… |
102,574 35% |
379,150 |
Q: What are the 2012 Federal Income Tax Rates
A: See the table below.
Unmarried Individual Returns
Taxable Income
|
Tax + % on Excess |
Of the Amount Over
|
|
$0 8,700 |
$0 10% |
$0 |
|
8,700 35,350 |
870 15% |
8,700 |
|
35,350 85,650 |
4,868 25% |
35,350 |
|
85,650 178,650 |
17,443 28% |
85,650 |
|
178,650 388,350 |
43,483 33% |
178,650 |
|
388,350 ………………. |
112,684 35% |
388,350 |
Joint Retuns
Taxable Income
|
Tax + % on Excess |
Of the Amount Over
|
|
$0 17,400 |
$0 10% |
$0 |
|
17,400 70,700 |
1,740 15% |
17,400 |
|
70,700 142,700 |
9,735 25% |
70,700 |
|
142,700 217,450 |
27,735 28% |
142,700 |
|
217,450 388,350 |
48,665 33% |
217,450 |
|
388,350……………… |
105,062 35% |
388,350 |