Are Social Security disability benefits taxable income?

Social Security OfficeSupplemental Security Income (SSI) benefits are not taxed, and for most people, Social Security disability insurance (SSDI) benefits are not taxed either. However, about one third of SSDI recipients do pay some taxes on their benefits, because of their spouse’s income or other income.

If you do have additional income, here is how to figure out whether you will owe taxes on your Social Security benefits. (This applies to retirement and survivors’ benefits as well as disability benefits.)

First, calculate your “combined income,” which is half of your Social Security benefits, plus your adjusted gross income, plus nontaxable interest.

You may have to pay taxes on up to 50 percent of your Social Security benefits if your combined income is more than:

  • $25,000 for single filers
  • $32,000 if married filing jointly
  • $0 if married filing separately

You may have to pay taxes on up to 85 percent of your Social Security benefits if your combined income is more than:

  • $34,000 for single filers
  • $44,000 if married filing jointly
  • $0 if married filing separately

Each January, you will get a 1099 from Social Security showing the benefits you received in the previous year, which you can use to file your taxes. If you do have to pay taxes on your SSDI benefits, you can choose to have taxes withheld from your benefits, or make quarterly estimated payments to the IRS.

Leave a Comment or Question (it will be moderated and will not appear immediately)