Taxability of Social Security during "Early" Retirement


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Regarding the rules about income for those taking social security early (say for ages 62 to 66):

When there is other income involved, when is the SS reduced:
  • If married (filing jointly), does the spouse's income affect whether the early retiree's income is taxable and or reduced?
  • Does 1099 income affect SS taxability/reduction?
  • Does unemployment affect SS taxability/reduction?
  • Does taxable withdrawals from regular IRA affect SS taxability/reduction?
  • Does taxable gains from non-tax-sheltered savings affect SS taxability/reduction?
  • If a non-retired spouse has schedule C income, does this affect SS taxability/reduction?
  • Will non-repayable PPP loans affect SS taxability/reduction?
Can someone recommend places for a layman to read up on the rules about income for those taking social security early?

Thank you!
 
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Dec 19, 2020
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Let's take these questions step by step.
First - your Social Security benefit amount is determined based on your age when you apply for it based on your most recent income tax information, joint if filing joint return, and the amount of credits you have with SSA during your working lifetime. The amount of reduction is determined then.
1099 income - if earned from self-employment sources - yes - is factored into the calculation of benefits - because if early retiring for Soc. Sec. - you're limited in the amount of earned income you can make until you reach full entitlement age. Any amount over the limit - you are forced to get reduced benefits the following year (I believe it's $ 1 for every $ 2 or something like that - over the maximum limit) . Every year the limit changes.
All other sources of taxable income effect the amount of your Social Security income that become taxable - because the Adjusted Gross Income amount is used in calculating how much of the total Social Security benefit is taxable that year.
To get all the rules - and current amounts you are requesting - go to www.ssa.gov.
 

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