Do you know that Social Security Benefits Can Be Taxed?
Understanding how taxes on social security benefits work can be incredibly complicated, according to the Social Security Administration, approximately 40% of the 57.9 million people who receive Social Security pay income taxes on their benefits, during 2014 more than $29.6 billion was collected in tax on Social Security Benefits. The Shocking thing, most retirees are not aware of how this tax is calculated or the fact that up to 85% of Social Security retirement income can be taxed each year! The calculation used to determine the amount of taxable Social Security benefits has not changed since 1983; more specifically the income break points used for this calculation have not been indexed to inflation for over 32 years. As your income increases over time to keep up with inflation, the taxable portion of your Social Security benefits increases as well.
We understand how this tax calculation works, we can show you how to help your clients reduce or eliminate tax on Social Security benefits and pay the lowest social security tax rate possible. Our Social Security Tax Strategy calculator was designed to help clients realize a potential increase in net spendable income by identifying & repositioning certain taxable income sources into Tax Deferred Annuities and Single Premium Life Contracts.