tax withholdings on SS?

[albireo13]

Hi,
I am retired now, and am just starting my SS. I submitted my application back in December and my first SS check will be in March! I am doing it at FRO, 66 and 2 months.

Anyway, I was curious about setting up tax withholdings on it. It's not clear to me what to set that to just yet. So, there will be no withholdings to start. My wife is still working fulltime for another 2 years.
My understanding is that up to 85% of my SS income will be taxable by the Feds. We have no state tax on SS income.

So, my thinking is not worry about for now until my wife retires and then our retirement situation will be stable. Until then, I can do quarterly estimated tax payments. Or .. I just set up some automatic withholdings (TBD).

I was just curious what other folks do??

 

[VanWinkle]

Hi,
I am retired now, and am just starting my SS. I submitted my application back in December and my first SS check will be in March! I am doing it at FRO, 66 and 2 months.

Anyway, I was curious about setting up tax withholdings on it. It's not clear to me what to set that to just yet. So, there will be no withholdings to start. My wife is still working fulltime for another 2 years.
My understanding is that up to 85% of my SS income will be taxable by the Feds. We have no state tax on SS income.

So, my thinking is not worry about for now until my wife retires and then our retirement situation will be stable. Until then, I can do quarterly estimated tax payments. Or .. I just set up some automatic withholdings (TBD).

I was just curious what other folks do??

I do not withhold from SS check, but i do make quarterly tax payments to cover the Roth Conversions I am currently completing. I would wait to see what the tax consequences are by estimating your taxes with a program like this:


https://www.mortgagecalculator.org/calcs/1040-calculator.php

VW

 

[Dash man]

Hi,

I am retired now, and am just starting my SS. I submitted my application back in December and my first SS check will be in March! I am doing it at FRO, 66 and 2 months.



Anyway, I was curious about setting up tax withholdings on it. It's not clear to me what to set that to just yet. So, there will be no withholdings to start. My wife is still working fulltime for another 2 years.

My understanding is that up to 85% of my SS income will be taxable by the Feds. We have no state tax on SS income.



So, my thinking is not worry about for now until my wife retires and then our retirement situation will be stable. Until then, I can do quarterly estimated tax payments. Or .. I just set up some automatic withholdings (TBD).



I was just curious what other folks do??

I withhold 22% and set it up during my telephone appointment to start my social security. It’s that much less I need to pay in my quarterly estimated taxes.

 

[Lakedog]

I have additional fed tax withheld from my pension to cover the taxes on social security. For me, increasing tax withholding on the pension was easier than having to setup withholding from another source (or making estimated payments). If you already have withholding from a current source of income, might be something to consider.

 

[xlf11]

You can only withhold max of 22% Fed tax and have to mail a paper form to local office, not as easy as changing DD on SSA website.

 

[pacergal]

We have tax withholding on both pensions and SS.
Set up 20% for SS when we first applied.

 

[homestead]

When doing your taxes for year (2021) you could create another preliminary file for 2022 for what you expect your SS and other income to be. This would give you an idea of what to withhold based on the output of your 2022 taxes.
It may also affect your state taxes depending on how your state taxes SS.

 

[Irishgirlyc58]

I will get my first SS payment on 2/9. I get my first pension payment on 2/1.
Once I get those I will do a tax estimate on my expected income and see if I need to adjust. I also received my last paycheck and a vacation buy out check in January that will factor in.
If I need to adjust I plan on doing that through my pension on line.
I pay state/fed taxes on my pension but only fed on SS.
Pension will be the easiest.
I don’t intend to take anything out of my 457b account this year.

 

[rk911]

Hi,
I am retired now, and am just starting my SS. I submitted my application back in December and my first SS check will be in March! I am doing it at FRO, 66 and 2 months.

Anyway, I was curious about setting up tax withholdings on it. It's not clear to me what to set that to just yet. So, there will be no withholdings to start. My wife is still working fulltime for another 2 years.
My understanding is that up to 85% of my SS income will be taxable by the Feds. We have no state tax on SS income.

So, my thinking is not worry about for now until my wife retires and then our retirement situation will be stable. Until then, I can do quarterly estimated tax payments. Or .. I just set up some automatic withholdings (TBD).

I was just curious what other folks do??

we keep it simple and straightforward by using the IRS safe harbor rule making automatic quarterly estimate payments.

 

[Out of Steam]

I withhold 22% and set it up during my telephone appointment to start my social security. It’s that much less I need to pay in my quarterly estimated taxes.

I'm trying hard to avoid quarterly estimated taxes, but I could easily end up having to do them.

 

[rk911]

I'm trying hard to avoid quarterly estimated taxes, but I could easily end up having to do them.

it does simplify our lives.

 

[skyking1]

I have additional fed tax withheld from my pension to cover the taxes on social security. For me, increasing tax withholding on the pension was easier than having to setup withholding from another source (or making estimated payments). If you already have withholding from a current source of income, might be something to consider.

That is what I plan on doing. The pension seems to be user-friendly to make changes on.

 

[ERD50]

I'm trying hard to avoid quarterly estimated taxes, but I could easily end up having to do them.

Remember, any sort of withholding (earnings, pension, SS, RMDs or other IRA/401/403, etc withdraw) is treated as done throughout the year. Much easier than quarterly payments, if you can do it.

-ERD50

 

[5Miler]

I mailed in the W-4V to have 12% withholding from my Social Security to cover anticipated ROTH conversions during the year. My first check arrived in December 2021 and the deduction was effective in that first payment. I find it easier than dealing with quarterly estimated payments but your mileage may vary as they say.

I can only do so much on conversions before the tax rate gets ridiculous so the 12% works out almost perfectly for me.

 

[jimbee]

I'm not receiving Social Security yet, but I just withhold the safe harbor amount of income tax each December when I rebalance/Roth convert/etc.

 

[Koolau]

I'm trying hard to avoid quarterly estimated taxes, but I could easily end up having to do them.

We had to do quarterlies for a long time. I always had taxes withheld from my pension, but it wasn't enough. Once I started RMDs, I had extra withheld and it covers virtually all our taxes, meaning no more quarterlies to remember. YMMV

 

[golfnut]

Withholding 7% from SS. Just set up last month.

 

[azxracer]

We didn't do tax withholding from SS and had a couple of years when we paid a penalty. Since I've started taking RMD that hasn't been an issue

 

[Venturer]

We both have 10% withheld from our SS as well as our pensions. When we start our RMD we will have to reevaluate the situation but so far we are good and get a little refund after we file.

 

[gayl]

Started getting it last year and set at my marginal tax rate, getting over 3k back from IRS

 

[TheWizard]

I have whatever the max withholding percentage is withheld each month.
But.......they apply that percentage to the next amount after Medicare and IRMAA are subtracted.

I have other places with easily adjustable withholding, so I will tweak that as needed going forward...

 

[Which Roger]

Hi,
I am retired now, and am just starting my SS. I submitted my application back in December and my first SS check will be in March! I am doing it at FRO, 66 and 2 months.

Anyway, I was curious about setting up tax withholdings on it. It's not clear to me what to set that to just yet. So, there will be no withholdings to start. My wife is still working fulltime for another 2 years.
My understanding is that up to 85% of my SS income will be taxable by the Feds. We have no state tax on SS income.

So, my thinking is not worry about for now until my wife retires and then our retirement situation will be stable. Until then, I can do quarterly estimated tax payments. Or .. I just set up some automatic withholdings (TBD).

I was just curious what other folks do??

Since your wife is still working for a while, assuming you're filing jointly, I would do a practice/fake tax return to figure out your tax liability, then adjust her withholding accordingly.