Friday, March 23, 2012

Do you need to pay taxes on earnings while receiving Social Security benefits?

If you are receiving Social Security benefits you still have to pay Social Security and Medicare tax on your earnings if you continue to work!
Whenever you work in a job covered by Social Security, your employer must deduct your Social Security and Medicare taxes from your salary and must pay the equal employer's share of the taxes. This is true, regardless of your age.
If you are self-employed while getting benefits and the annual net profit from your business is more than $400 that, too, is covered by Social Security and Medicare taxes. You must report those earnings and pay the Social Security and Medicare taxes when you file your personal income tax return.
The Internal Revenue Service (IRS) is the authority on all tax matters including the collection of Social Security taxes.
You can direct your questions to the IRS by:
  • Calling their toll-free number, 1-800-829-1040; or
  • Calling or visiting any local IRS office; or
  • Writing to the national address of the IRS which is: Internal Revenue Service 1111 Constitution Avenue, NW Washington, D.C. 20024; or
  • Accessing the IRS website.

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