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Old 03-01-2016, 03:37 PM
 
Location: Gilbert, AZ
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Thanks for the information. I've got a lot of learning to do on this one... (in response to #109)
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Old 03-02-2016, 03:24 AM
 
6,353 posts, read 5,161,362 times
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Quote:
Originally Posted by hikernut View Post
Be sure you understand the phantom tax brackets that can appear once you start taking SS benefits. Income that would normally be taxed at 15% can possibly taxed as high as 27.75%. And some income that falls into the 25% bracket can actually be taxed at 46.25%.
I am aware of that, thanks. I am going to pay income tax of 85% of my SS benefits no matter what, so I might as well get used to it.
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Old 03-02-2016, 04:18 AM
 
71,593 posts, read 71,751,865 times
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same here . the phantom tax is something lower income earners have to worry about . it is ironic that those with incomes just under the threshold are the ones who have to worry the most
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Old 03-02-2016, 06:07 AM
 
Location: Los Angeles area
14,018 posts, read 17,740,386 times
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Quote:
Originally Posted by Larry Siegel View Post
I am aware of that, thanks. I am going to pay income tax of 85% of my SS benefits no matter what, so I might as well get used to it.
Quote:
Originally Posted by mathjak107 View Post
same here . the phantom tax is something lower income earners have to worry about . it is ironic that those with incomes just under the threshold are the ones who have to worry the most
Yep, and one possible tweak to shore up SS could be that Congress would vote to turn the 85% into 100%. That was mentioned recently, but I don't recall if in this thread or some other one. It didn't used to be taxed at all at the federal level, but the tax was voted in by Congress under Reagan in 1983 if I recall correctly. The trigger points have never been adjusted for inflation since then, resulting in a de facto reduction of the trigger points and more and more people being taxed on SS.
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Old 03-02-2016, 02:39 PM
 
Location: Ohio
19,916 posts, read 14,238,717 times
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Quote:
Originally Posted by Escort Rider View Post
Yep, and one possible tweak to shore up SS could be that Congress would vote to turn the 85% into 100%.
Taxation of Benefits yielded only $16 Million in December 2015, although it brought in $5.87 Billion in January (due to the fact that quarterly payments are made in January).

Taxing 100% of benefits (while it wouldn't hurt) wouldn't cure Social Security of its problems, either.

Quote:
Originally Posted by Escort Rider View Post
It didn't used to be taxed at all at the federal level, but the tax was voted in by Congress under Reagan in 1983 if I recall correctly. The trigger points have never been adjusted for inflation since then, resulting in a de facto reduction of the trigger points and more and more people being taxed on SS.
I believe it was the Clinton Administration that started taxing benefits, possibly as a compromise to raising the FICA payroll tax.

$25,000 was an arbitrary figure selected (perhaps because it was ~250% of the then poverty level), with no means in the law to adjust the figure for Inflation of any kind, or for increases in COLA or increases in the poverty level.
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Old 03-02-2016, 08:50 PM
 
Location: The Berk in Denver, CO USA
14,035 posts, read 20,355,620 times
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I would encourage you to smoke more tobacco. Unfiltered cigarettes have the best flavor.
I would encourage you to drink at least 750ml of whiskey a day. Stay above 40% ABV.
I would encourage you to watch only TV shows that make you angry. Fox and/or MSNBC are good starters.

You have within you to make SS more solvent.
Thank you.
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Old 03-03-2016, 07:26 AM
 
Location: Charleston, SC
1,362 posts, read 767,627 times
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The initial Tax on Social Security benefits was enacted by the Reagan Administration in 1983. Those who paint Saint Ronnie as a Tax-cutter will take heart in the fact that it was a bi-partisan effort, and Tip O'Neill has as many fingerprints on this bill as anyone else.

The Clinton Admin took a whack at retirees in 1993 by increasing the Tax to 85%, again a bi-partisan movement.

Taxing Retiree Benefits will not cure what ails the SS funding. Raising the upper wage limit (stuck at around $106K for quite a while) will add more money to the fund than any amount of benefit taxation.
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Old 03-03-2016, 07:43 AM
 
Location: Tennessee
23,581 posts, read 17,574,904 times
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Quote:
Originally Posted by TuborgP View Post
You are making the same mistake that I have often made even having been raised, educated, worked and now retired in various Eastern locations. For defined geographic purposes that data collection would probably used if they wanted to be accurate Maryland, DC and Virginia are in the South. Until I graduated from college and moved below the Mason Dixon line I just naturally considered them in the South. When you remove them from your Northern comparison and put them in the Southern comparison I suspect you would agree the data changes:
I've seen this before, and while the data will obviously change as MD/VA in particular are wealthy states, I can't really see an argument for MD being Southern at all these days, and VA's population centers around DC are not really Southern either. Much of rural VA is still culturally Southern (and the residents would get pretty offended to be labeled as northeastern), but that's not where the jobs and the wealth are.

Switch the definition from geographically Southern to culturally Southern and you'll get results more in-line with reality.
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Old 03-03-2016, 07:52 AM
 
Location: Los Angeles area
14,018 posts, read 17,740,386 times
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Quote:
Originally Posted by FiveLoaves View Post
........................

Taxing Retiree Benefits will not cure what ails the SS funding. Raising the upper wage limit (stuck at around $106K for quite a while) will add more money to the fund than any amount of benefit taxation.
Taxing retiree benefits is not enough to "cure what ails the SS fundinig", but it could be part of a package of measures, which taken together, will make a difference. Indeed, raising the upper wage limit is a frequent candidate in discussions, but that raises a philosophical question because benefits are also capped at that level. Leaving the benefit cap while increasing the upper wage limit for payroll taxes would increase the extent of wealth transfer inherent in the Social Security structure, thus providing ammunition to enemies of SS, while letting the benefits cap rise to match the rise in the tax cap would drastically reduce the increased funding for SS. Which way would you have it?
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Old 03-03-2016, 07:57 AM
 
Location: OKLAHOMA
1,784 posts, read 3,618,716 times
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Also be aware of medicare going up. Thought we be paying the 104 I've heard of for a long time well.....I guess it is going broke so we're paying more than twice that. It is now based on your worth I guess.
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