Higher Tax Bills Are Coming for Social Security Retirees.
More retirees who collect Social Security benefits are going to owe taxes on that retirement income this year and next compared with prior years. And the total amount of tax retirees pay on their benefits is probably going to be higher.
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The problem that exists for seniors is that these thresholds at which benefits become taxable are not indexed to inflation. They have not changed since the law first introducing taxation of benefits passed in 1983.
So, while fewer than 10% of beneficiaries originally owed these taxes, now about half of all households do -- and more are expected to in 2022 and 2023 than in prior years because of higher inflation
More retirees who collect Social Security benefits are going to owe taxes on that retirement income this year and next compared with prior years. And the total amount of tax retirees pay on their benefits is probably going to be higher.
.
.
.
The problem that exists for seniors is that these thresholds at which benefits become taxable are not indexed to inflation. They have not changed since the law first introducing taxation of benefits passed in 1983.
So, while fewer than 10% of beneficiaries originally owed these taxes, now about half of all households do -- and more are expected to in 2022 and 2023 than in prior years because of higher inflation