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Chart for Taxation of Social Security Benefits
Income % of Social Security Taxable

Below $25,000 All SS income is
tax free
Single, Head of Household, Qualifying Widower $25,000
and Married Filing Sparately (where spouses lived - Up to 50% of SS income may
apart the entire year) $34,000 be taxable
Up to 85% of SS income may
More than be taxable
$34,000

Below $32,000 All SS income is
tax free
Married Filing Jointly $32,000 Up to 50% of SS income may
-
$44,000 be taxable
Up to 85% of SS income may
More than be taxable
$44,000

Taxes on Tax-Deferred Account

Withdrawals
delete the 3

When you withdraw money from your IRA, IRA rollover, or 401(k),

those dollars will be taxed as ordinary income upon withdrawal.
Money drawn from tax-deferred retirement accounts is taxed

at your top ordinary income tax rate, which can be as high as
3
37%. Suppose that you need to buy a new car and want to tap
your retirement accounts for that money. If you need $40,000 to
buy a new car and you are in the 25% tax bracket, you’ll need

to withdraw approximately $53,000 from your IRA to cover the

Chapter 5: Things That Can Wreck Your Retirement