Tax Base

• To calculate the tax liability you may have due to your Social Security benefits, you must first determine your tax base. You are only responsible for taxes on the income you receive that exceeds the base amount for your filing status. If you are single, head of household or married filing separately and living apart from your spouse during the tax year, the base amount is $25,000. If you are married filing jointly, your tax base is $32,000. If you are married filing separately and you live with your spouse, your tax base is $0.
  
  

Checking Your Tax Liability

• To determine if you may owe tax, take half of the Social Security benefits reported to you on your SSA-1099 form and compare that amount to the base established for your filing status. If you have additional income, including interest income, first take half of your Social Security benefits, add the additional income and compare that to your base. If the result of your calculation is less than or equal to the tax base for your filing status, you owe no tax. If you are married filing jointly, you must combine both of your incomes, including the Social Security benefits, before performing the calculation.
  
  

Survivor Benefits

• Your SSA-1099 form shows the name of the person who is legally entitled to the benefits. Survivor's benefits may include income for your child. If your child is a minor, the check may be made out to you instead of your child. You do not include your child's benefits when you calculate your tax liability; this amount goes on your child's return. Your child's benefit must be cut in half and added to your child's other income before performing the calculation. If there is no other income, calculate the tax based on just the Social Security income, using the appropriate base.
  
  

Lump-Sum Payment

• If you received a lump-sum benefit that was a retroactive payment that included benefits for a previous year, include the lump-sum payment in your calculation for the year you received the payment. If the tax liability is too high, you may elect to separate the payment and apply it to the earlier year, but you must add the portion for the prior year to the income you declared in that year's taxes, then subtract any benefits you previously reported. The result is the taxable portion of your lump-sum benefit for the prior year. This portion would be excluded for the current year's calculations.