Turbotax.com has helped many individuals that have questions with filing taxes, when they receive Supplemental Security Income. There are certain factors that take place to determine if the individual would have to file taxes when they receive SSI benefits.
Each state may have different regulations on the taxes for SSI, as well since state taxes usually have to be paid with any income. Usually, most states do not require for taxes to be taken out for SSI. The best way to find out for sure, is to contact the state and local taxing authority.
When it comes to federal taxes, it is a little different. If the individual, receiving SSI, has a total income over $25,000, then they will have to pay the federal taxes on the SSI benefits they received. This is going to be the amount if they file single. If they are married and file jointly, their combined income amount has to be over $32,000 in order for them to have to pay federal taxes on the SSI being received.
Throughout the year, federal taxes do not have to be withheld from the SSI. It is easier to have the federal taxes taken out, or to pay them, every quarter. This will ensure that when the taxes are filed, the individual doesn’t have to come up with extra funds to cover the taxes that were not paid. In order to have the taxes taken out, the individual will need to file an IRS tax Form W-4V. This form is going to state the percentage of taxes that are requested to be taken out. Then, the form will need to be mailed in to the individuals Social Security office, or taken in by person, after it has been signed.
If the individual received SSI benefits and still works at a place of employment, they will be required to still pay state and federal taxes for the job they have. If they are self-employed and made over $400, they will also need to report the income and pay the required taxes. Any type of earning in addition to the SSI benefits will have to be reported, no matter what.