Solved

Pensions: oddly only taxing about 30% of our retirement income for 2021. Last year almost all was taxable?

Forum|Forum|4 years ago
March 14, 2022
2 replies
0 views

We've inputted all 1099-Rs. TurboTax has the Taxable Amount at about 30-35% of the total. Nothing has changed from l2020 and 2019, when the taxable amount was almost 100% of the total amount. What has changed? We went over the questions as to RMD (only one account); fed tax withheld is about the same as previous years. We are hesitating e-filing until we can get this question answered as the tax refund is vastly different due to such a big difference in our total taxable income.
Is this a glitch????

Best answer by Vanessa A

Have you double checked all of your entries?

When you say only 30% of your income is taxable, where are you getting that number? Social Security when taxed is taxable for 50-85% of your benefits.

Are you getting the stimulus payments added to your return on line 30? If so, this could make it look like less of your retirement is being taxed. If this is the case, be sure you did NOT get the payment before submitting your return. If you did get it, you will need to go back to the federal review section and enter that you each received the $1,400 stimulus payments.

You can look at your 1040 for this year and compare it to last years 1040. This will tell you where the difference is coming from.

If you fall into the following, 85% of your social security is taxable income

Single with income above $34,000
Married Filing Jointly with income above $44,000
Married Filing Separate regardless of income

If you fall into the following, 50% of your social security is taxable income

Single with combined income between $25,000-$34,000
Married Filing Jointly with combined income between $32,000 and $44,000

Your combined income is calculated by adding your

AGI plus
Nontaxable Interest plus
1/2 of your social security Benefits

V

Vanessa AAnswer

Have you double checked all of your entries?

When you say only 30% of your income is taxable, where are you getting that number? Social Security when taxed is taxable for 50-85% of your benefits.

Are you getting the stimulus payments added to your return on line 30? If so, this could make it look like less of your retirement is being taxed. If this is the case, be sure you did NOT get the payment before submitting your return. If you did get it, you will need to go back to the federal review section and enter that you each received the $1,400 stimulus payments.

You can look at your 1040 for this year and compare it to last years 1040. This will tell you where the difference is coming from.

If you fall into the following, 85% of your social security is taxable income