If you look at your most recent paycheck, you are going to see a guy by the name of “FICA” subtracting money from your take-home pay. Part of that FICA tax is sent to the Social Security system, which entitles you to receive Social Security payments when you retire. The unfortunate news is that, even though it was a tax that you paid while you were working, most retirees will have to pay some form of Income Tax on it. So, it’s a tax you pay on a tax? Pretty much!
In this video, I will be covering:
• The percent of your Social Security benefit that will be taxable
• The tax rate that you pay on your Social Security benefits
• The Social Security earned income penalty
• State income tax exceptions
• Withholding taxes from your Social Security payments