Social Security Disability (SSD) benefits aren’t subject to state taxes in California, but the federal government is likely to tax them. If you are disabled and need help filing for SSD benefits, it’s important to anticipate how this financial resource can factor into this year’s tax return.
How Much Tax Does the IRS Take from SSD Benefits?
If you receive Social Security disability benefits, it's important to know how much taxes the Internal Revenue Service (IRS) will take from your monthly payments. Generally, the IRS can tax up to 85% of Social Security Disability (SSD) benefits depending on factors such as total income level and filing status.
Your SSD benefits are classified as taxable income if your combined gross income exceeds certain amounts based on filing status. Gross income includes any wages you earn, investments, interest earned, capital gains, alimony received, unemployment compensation, and other sources of taxable income.
If your combined incomes exceed $25,000 for single filers or $32,000 for joint filers, then 50% of your SSD benefits are subject to federal income taxes. If your combined incomes exceed $34,000 for single filers or $44,000 for joint filers in 2020, then 85% of your SSD benefits are subject to federal income taxes.
Contact Us for Help with Your SSD Benefits Claim
At Smolich and Smolich, we have the experience and expertise to help our clients through their Social Security Disability claims. Our attorneys have worked with hundreds of clients over many years who have needed assistance in applying for benefits or appealing a denied claim.
We understand that preparing an SSD claim can be an intimidating process, especially when it comes to dealing with denials or other obstacles. That’s why we take the time to assess your individual situation and provide you with personalized advice on how best to proceed. We’ll make sure you understand all requirements and paperwork involved in filing your application or appeal, as well as discuss any legal strategies that could strengthen your chances of success.
For more information about how we can help, contact Smolich and Smolich today.