Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
My Medicare Part B premium, which is normally deducted from the Social Security monthly retirement benefit, was greater than the benefit. So the benefit was withheld (suspended) and applied as a credit against the Part B premium and I was billed for the difference. Perfectly logical to me so far.
Then came the end of the tax years and I received no 1099 from Social Security, who claimed that of course not - I was no longer receiving a benefit. Well, it's true I wasn't receiving it as an electronic deposit into my checking account, but in my mind I was indeed "receiving" it as a credit towards my health insurance premium.
I do not do my own taxes. My CPA said we'd better go along with their logic or it would be a big mess. OK, fine, so we did not claim any income from Social Security, which saved me from paying taxes on the 85% of it which would have been taxable if I hadn't had a Medicare Part B premium. Note that this all accrues to my benefit. But being honest, I felt I should be paying the taxes on 85% of my benefit.
Note also that the amount of money involved is negligible - my monthly SS benefit is $130 and change. It's the principle of the thing I'd like to understand. I'm one of those people who wants stuff to make sense. Maybe my thinking is off, as I am decidedly not an "account/tax knowledgeable type". Who can help me understand?
My Medicare Part B premium, which is normally deducted from the Social Security monthly retirement benefit, was greater than the benefit. So the benefit was withheld (suspended) and applied as a credit against the Part B premium and I was billed for the difference. Perfectly logical to me so far.
Then came the end of the tax years and I received no 1099 from Social Security, who claimed that of course not - I was no longer receiving a benefit. Well, it's true I wasn't receiving it as an electronic deposit into my checking account, but in my mind I was indeed "receiving" it as a credit towards my health insurance premium.
I do not do my own taxes. My CPA said we'd better go along with their logic or it would be a big mess. OK, fine, so we did not claim any income from Social Security, which saved me from paying taxes on the 85% of it which would have been taxable if I hadn't had a Medicare Part B premium. Note that this all accrues to my benefit. But being honest, I felt I should be paying the taxes on 85% of my benefit.
Note also that the amount of money involved is negligible - my monthly SS benefit is $130 and change. It's the principle of the thing I'd like to understand. I'm one of those people who wants stuff to make sense. Maybe my thinking is off, as I am decidedly not an "account/tax knowledgeable type". Who can help me understand?
Why not just call the SS office and find out from the horse's mouth? Or, if you do not want to identify yourself (every time you call you have to punch in your SS #. DOB, etc), have a friend call and just pose it as a hypothetical question.
Why not just call the SS office and find out from the horse's mouth? Or, if you do not want to identify yourself (every time you call you have to punch in your SS #. DOB, etc), have a friend call and just pose it as a hypothetical question.
I did call them, as implied in the first sentence of my second paragraph.
Maybe you should write your congressman and let him/her change the rules. Help to reduce the debt.
But by raising taxes on the elderly.:_)
I believe everyone gets the same break. Ss gross less the medicare B premium is what the normal SS check is. And what the 1099 is. Now that insurance premiums are deductible you are getting the same net as someone paying individual insurance policy.
Leave it to Escort Rider to make me think, "Hmmm?"
I never would have thought of that!
Take a trip down to the SS office and get the "No 1099" in writing.
A local SS office will not issue a 1099. They are issued centrally and in the case I cited (my own) they did not issue one because their interpretation is that I was not receiving a benefit. That is my whole point.
Maybe you should write your congressman and let him/her change the rules. Help to reduce the debt.
But by raising taxes on the elderly.:_)
I believe everyone gets the same break. Ss gross less the medicare B premium is what the normal SS check is. And what the 1099 is. Now thatinsurance premiums are deductible you are getting the same net as someone paying individual insurance policy.
Health insurance premiums are considered a medical cost, are they not? So they are only deductible if your total medical and dental costs for the year exceed a percentage (I think 7.5%) of your adjusted gross income. That means that to be deductible, you have to have horrendous medical costs or very low income.
But your other point makes sense. If the normal Social Security 1099 is for only the amount that people are receiving after the Part B premium deduction, then that principle was consistently applied in my case, i.e., the amount was zero so no 1099 was issued. It's the principle which makes no sense to me, and while I thank those who responded so far, no one has yet to explain any logic behind it.
I believe everyone gets the same break. Ss gross less the medicare B premium is what the normal SS check is. And what the 1099 is. Now that insurance premiums are deductible you are getting the same net as someone paying individual insurance policy.
No, that is NOT correct. My 1099 states the gross amount of SS BEFORE the deduction for Medicare Part B. I include the Medicare Part B premium in my medical deduction calculations.
Quote:
Originally Posted by Escort Rider
But your other point makes sense. If the normal Social Security 1099 is for only the amount that people are receiving after the Part B premium deduction, then that principle was consistently applied in my case, i.e., the amount was zero so no 1099 was issued. It's the principle which makes no sense to me, and while I thank those who responded so far, no one has yet to explain any logic behind it.
The principle has NOT been consistently applied in your case. SS has made an error. At the very least, you should have received a 1099 for the gross SS payment and SS should have listed somewhere on that 1099 the deduction for Medicare Part B - although it is NOT their normal procedure to list the Part B premium anywhere on the 1099.
As I said above, my 1099 reports the gross SS income. It is up to me to remember to deduct that Part B premium on my taxes if it exceeds the 7.5% limit, but the Part B premium is not stated anywhere on the 1099 that I receive.
Escort Rider you are correct. So is your accountant when he says if you contact SS for a corrected 1099, it will create a mess. It will be a long time before the IRS ever catches this unless you are one of the high income people who gets audited regularly.
However, you could report these payments anyway - gross 130x12=$1,560. 50% (or $780) of that is added to your modified AGI to arrive at what is called 'provisional income.' If provisional income exceeds $25,000 for a single person, up to 85% of the $780 may be taxable depending on how far above $25,000 you are. Not more than a few hundred dollars in tax in any event.
I agree with you, Escort Rider. But, after a lengthy argument with SS over a mistake made on its part, I also realize that it's almost impossible to get SS to amend its errors -- unless you get an attorney. Every person you call at the SS 800 number and every person you see in person at your local SS office will give you a different answer -- and none will be correct. Good Luck!
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
