Do you pay taxes on all or part of your social security benefits?
Social security benefits are very important, and how much money you put in for your SS is vital for how you will live out your retirement. In most cases, your social security benefits are taxable by the federal government in instances if you are a single taxpayer with a base amount of $25,000 per year, or are married taxpayers with a base amount of $32,000 per year. The amount taxed is varied based on the income you make during your retirement. Obviously, people with much higher and comfortable social security benefits will be taxed at a higher rate than others. Rates can be as high as 50% of your yearly benefits, and sometimes even higher. There are ways around paying taxes on your benefits, since there are retirement plans that allow for no tax breaks during your working time, but grant you a tax free life of retirement. These plans are risky because nobody really knows when they will eventually die, so being taxed more to have a better retirement that ends up being short-lived can be a bit pointless.