Is Social Security Disability Taxable?

If you receive Social Security disability benefits you might be wondering whether or not the income is taxable. As we head into tax season it’s important you have all the facts. The short answer is, it depends. For a good majority of people, it is not taxable. However, for those who receive income from another source or have a spouse that receives additional income, your benefits might be taxable. The more income you have as an individual or as a married couple, the likelihood you have to pay taxes on Social Security disability benefits is greater. The IRS sets the thresholds for what’s taxable.

Here’s the breakdown:

If you file a federal tax return as an individual:

  • If your income is between $25,000 and $34,000 – you may have to pay income tax on up to 50 percent of your benefits.
  • If your income is more than $34,000 – up to 85 percent of your benefits may be taxable.

     

If you file a federal tax return as a joint return:

  • If you and your spouse have a combined income between $32,000 and $44,000 – you may have to pay income tax on up to 50 percent of your benefits.
  • If you and your spouse have a combined income of more than $44,000 – up to 85 percent of your benefits may be taxable.

 

It’s important to note if you are married and file a separate tax return the likelihood of paying taxes on your income is higher.

If you receive Social Security Disability benefits, be on the lookout for the Social Security Benefit Statement (Form SSA-1099). You receive this Benefit Statement each January, which shows the amount of benefits you received in the previous year. Use this statement when you complete your federal income tax return to help you figure out if your benefits are subject to tax.

Still have questions about your specific situation? Tax law is complex, and we recommend that you consult with a tax professional.

Roose & Ressler is a team of Social Security disability lawyers with more than 40 years of experience handling disability claims in northern Ohio. We have offices located throughout northern Ohio in Mansfield, Toledo, Wooster, and Lorain. We are passionate about helping you appeal or win your claim. In addition to offering a free initial consultation, we are caring lawyers committed to understanding the frustrations and delays people experience with Social Security disability claims in Ohio.

January 12, 2022 Thought Leadership Articles
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