Tax season is officially upon us and April 15th will be here sooner than you know. And many people want to know if their Social Security Disability Benefits are taxable. I am not a tax professional or a tax attorney. But I am a Social Security attorney. The answer is that it depends. It depends on how much you received in benefits and other income. It depends on how you file your taxes (single/married filing jointly/married filing separate).A tax professional will be able to tell you what is best for your specific situation. But here is a breakdown of how the taxability of your benefits is determined.
If you are receiving Social Security benefits, you will receive a 1099 form from SSA which outlines the benefits you received. To determine whether or not those benefits are taxable, you will take 50% of the benefit amount and add to it any: taxable/pensions/wages/interest/dividends/or other taxable income. Compare this new figure to the “base value”. The base value is $32,000 for someone married filing jointly ($25,000 if filing single). If your amount is less than the base value, then you owe nothing in taxes. However, if your amount is higher than the base value then your Social Security benefits are taxable. There is a worksheet for you to complete to determine the amount of tax that you will owe on your benefits.