Filing taxes is a challenging task for many people, but it can be especially confusing for those who collect Social Security disability benefits. If you receive this type of income from the government, your obligation to file might not be clear. Typically, it will depend on your total income and marital status. However, if Social Security is the only source of money you have coming in, it usually won’t be necessary for you to submit a tax return. Here are a few tips that will help you avoid running into any surprises with your taxes.

3 Tax Tips to Use if You Collect Social Security Disability Benefits

1. Determining if You Owe Taxes

It’s important to determine if you owe taxes on your Social Security disability benefits, so you don’t end up receiving any penalties from the government. If you have income in addition to your benefits, you might owe on at least part of your Social Security. You can figure out if any of your disability benefits will be taxable by adding up all of your income, plus half of your benefits. If the total is more than the reported base amount on your filing status, you will owe taxes.

2. Calculating Your Tax Bill

Calculating your potential tax liability will help you know what to expect and plan for financially. If you exceed your base amount, there’s a good chance up to half of your benefits will be taxed. There is the possibility it could be much more than this, however, contingent on whether you file as single and earn more than $34,000 or file as married and bring in more than $44,000.

3. Paying Throughout the Year

If you find out your disability benefits are taxable, you might consider doing what you can to minimize what you owe. This can be done by opting to have federal income tax automatically withheld from your benefits. You will have the ability to choose what percentage you want taken out. Doing this will take care of your tax obligation throughout the year, so you don’t have to pay a lump sum at one time.

The taxability of Social Security disability benefits can be a complex topic to understand. If you need further clarification regarding your responsibility to file or how much you might expect to pay, it’s best to consult with a professional who specializes in tax advice. For those in Cincinnati, OH, who need to apply for disability benefits, contact an attorney at David W. Kapor & Associates. Their legal team has more than 30 years of experience helping clients get approved for the benefits they deserve. Call the practice today at (513) 721-2820 to schedule a consultation, or visit them online to learn more about their services.