Although not all United States citizens have it in mind, the one change that may affect Social Security recipients is not just the COLA, which increases checks year after year. Beyond that, the IRS may change the rules and the taxes we pay as citizens a bit.
Tax Brackets change based on inflation, just as the COLA does with Social Security checks. For that reason we must be very watch out for everything related to taxes and the Tax Return we send to the IRS each year.
In the coming year 2024 we will have to apply slightly higher taxes to everything related to income. Of course, this change does not affect in the same way to All United States citizens, since each of the United States citizens is totally different and, therefore, each United States citizen has to make his Tax Return according to his income. Do you want to know how much you will pay in Social Security taxes in 2024?
HOW DOES THE NEW IRS TAX BRACKET AFFECT SOCIAL SECURITY?
First of all, there is one very important thing to keep in mind regarding Social Security taxes. Most citizens who collect only a monthly retirement check do not have to pay taxes.
Likewise, even when a citizen collects a very large Social Security check, he or she does not have to pay taxes on the entire check. Each case is totally individual and we should consult the IRS or an expert to make sure we are submitting our Tax Return correctly.
Therefore, these changes could affect our monthly Social Security check, but even so this does not mean that we have to pay much more taxes. Especially if we think about the fact that these payments are not taxable in most cases.
On the other hand, checks like Supplemental Security Income or SNAP Food Stamps are not taxable, so we don’t have to worry about that when it comes to paying taxes. Regarding the rest, it should be noted that these new Tax Brackets will be for 2024, so they should be included in the 2025 Tax Return.
WHAT WILL THE TAX BRACKET BE IN 2024?
As of January 2024 we will have to take into account a new tax bracket for both Social Security and all other income. This tax bracket will apply to 2024 benefits, but we will actually have to include it in the 2025 Tax Return.
For individual returns the bracket will be as follows:
- 37% for annual returns over $609,350.
- 35% for annual returns over $243,725.
- 32% for annual returns in excess of $191,950.
- 24% for annual returns in excess of $100,525.
- 22% for annual returns in excess of $47,150.
- 12% for annual returns over $11,600.
- 10% for annual returns of $11,600 or less.
In the case of a couple declaration we will have the following Tax Bracket:
- 37% for annual returns over $731,200.
- 35% for annual returns over $487,450.
- 32% for annual returns over $383,900.
- 24% for annual returns in excess of $201,050.
- 22% for annual returns in excess of $94,300
- 12% for annual returns greater than $23,200
- 10% for annual returns of $23,200 or less
And with this information we can already make a calculation from January 2024 about the taxes we will have to pay. Remember that until 2025 we will not have to increase these taxes, but we do have to take this into account when we collect our Social Security check every month as well as any other income.