Social Sec. withholding. From a "seasoned" citizen.?

Question

I recently started receiving SS benefits. A notification letter states that 30% will be withheld (two ayches, yes) at source.

I assume that a year-end recap document for is sent annually for 1040 season, but should like to have confirmation of this.

Thanks in advance.

Answer 1

30% of your Social Security benefit will be withheld? Doesn't sound right unless you're in a very high tax bracket. And in any case, shouldn't be withholding unless you have requested it. Check with your local social security office.

Social security can be taxable, depending on the amount of your other income - if you don't have much other income, won't be taxed. Yes, you'll get a recap at the end of the year, form SSA-1099, showing the total benefit and any federal withholding taken out. When you file your tax return, you'll show your social security income, and show any withholding, which will be subtracted from your taxes owed just like any other withholding. There's a calculation on your tax return to determine whether any or all (up to 85%) of your benefits are taxable. If you're going to owe tax on your social security, is a good idea to have it deducted monthly.

Is it possible that the deduction is for your medicare premium? They do deduct for that for people on medicare, and you don't get it back.