Compute the taxable SS benefits in the following situations: 1. Edward and Emily are married and...

Compute the taxable SS benefits in the following situations:

1. Edward and Emily are married and file a joint tax return. they have adjusted gross income of $46,000 no tax exempt interest, and $12,400 of SS benefits.

2. Edward and Emily have adjusted gross income of $12,000 no tax exempt interest, and $16,000 of SS benefits.

3. Edward and Emily have adjusted gross income of $85,000 no tax exempt interest and $15,000 of SS benefits.

Please explained in a detailed way and show how you got the numbers.

Expert Solution

Part 1) No social security will be taxable because the couple who files jointly have to pay upto 50% of SS benefit if their gross income is between $32000 to $44000. But in this case it is $46000.

Part 2) In this case SS benfit is not taxable because their gross income is not more than $44000.

Part 3) In this case SS benefit is taxable upto 85% because their gross income is more than $44000.

i.e. 85% of 15000 = $12750 Is taxable.

Basic Rules for SS BENEFITS are

Taxable upto 85% if gross income is more than $44000 for couples and Taxable upto 50% if gross income is between $32000 to $44000 for the couples filing jointly.

jeff jeffy answered 2 years ago

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