Join Early Retirement Today
Thread Tools Search this Thread Display Modes
SS benefits and MAGI
Old 11-21-2010, 06:34 AM   #1
Recycles dryer sheets
Join Date: Sep 2010
Posts: 91
SS benefits and MAGI

I am not at the point of getting my SS payments yet but I wondered what tax exempt monies are included in the MAGI calculation to figure the taxation of SS payments. In particular I have many IRA accounts and a 401K. Are the earnings from these each year included into the MAGI calculation

afntrn56 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 11-21-2010, 07:03 AM   #2
Thinks s/he gets paid by the post
FIRE'd@51's Avatar
Join Date: Aug 2006
Posts: 2,241
Only actual withdrawals from IRA's/401k's are included in the MAGI.

I'd rather be governed by the first one hundred names in the telephone book than the Harvard faculty - William F. Buckley
FIRE'd@51 is offline   Reply With Quote
Old 11-21-2010, 07:32 AM   #3
Thinks s/he gets paid by the post
Join Date: Jan 2006
Posts: 2,504
Originally Posted by FIRE'd@51 View Post
Only actual withdrawals from IRA's/401k's are included in the MAGI.
Here's something from SSS: (see formula at bottom)
************************************************** *************
Taxes and your Social Security benefits

Frequently Asked Questions
Some people have to pay federal income taxes on their Social Security benefits. This usually happens only if you have other substantial income (such as wages, self-employment, interest, dividends and other taxable income that must be reported on your tax return) in addition to your benefits.

No one pays federal income tax on more than 85 percent of his or her Social Security benefits based on Internal Revenue Service (IRS) rules. If you:

file a federal tax return as an "individual" and your combined income* is
between $25,000 and $34,000, you may have to pay income tax on up to 50 percent of your benefits.
more than $34,000, up to 85 percent of your benefits may be taxable.

file a joint return, and you and your spouse have a combined income* that is
between $32,000 and $44,000, you may have to pay income tax on up to 50 percent of your benefits
more than $44,000, up to 85 percent of your benefits may be taxable.

are married and file a separate tax return, you probably will pay taxes on your benefits.

Your adjusted gross income
+ Nontaxable interest
+ of your Social Security benefits
= Your "combined income"
************************************************** ************
As noted in formula above, the number that determines how much SS is taxed is your "combined income".............your AGI (w/o SS) will include any taxable IRA/401K withdrawals. The nontaxable INTEREST term may have been? what you were thinking about.........that basically means muni bond interest (including that from funds). The earnings in your IRA/401K would generally not have been interest (tho they could have been) nor were they nontaxable (tax deferred instead). Also note the 50/85% numbers above are NOT the tax rates on SS.....they just tell you how much of the SS would be included in your AGI for the purpose of calculating tax at your tax rate.
kaneohe is offline   Reply With Quote

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
Reducing income (MAGI) during early retirement indexfundfan FIRE and Money 4 03-28-2010 07:48 PM
Anyone using the VA for medical benefits? collkas Health and Early Retirement 17 02-21-2010 05:39 AM
SS benefits estimator cardude FIRE and Money 28 10-16-2009 09:53 AM
Who Benefits from Volatility? Culture FIRE and Money 39 10-17-2008 08:23 PM
SS benefits and spending MRGALT2U FIRE and Money 35 05-14-2005 09:14 AM


All times are GMT -6. The time now is 04:22 PM.
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2016, vBulletin Solutions, Inc.