Some Important Updates for Seniors

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seniors receiving adviceOurSeniors.net tries to be your all-things-senior source for dependable and unbiased information. With that in mind, here is a very brief reminder of some important dates, figures and changes in tax and Social Security laws.

Some important dates for 2018

If you make quarterly tax payments during the year, they are due on:

  • April 17, 2018
  • June 15, 2018
  • September 17, 2018
  • January 15, 2019

Changes in Taxable Income, Standard Deductions and Personal Exemptions

The tax year 2018 brings changes in the way taxable income is determined. In the past, taxable income has been Adjusted Gross Income minus total personal exemptions ($4,050 for each exemption), minus the standard or itemized deductions. In 2017, a senior couple (65+) could claim two personal exemptions (2 X $4,050= $8,100) plus a maximum standard deduction of $15,200. This couple did not owe any tax at all until their adjusted income exceeded $23,300 (the total of two exemptions and the standard deduction). This figure might have been higher if itemized deductions were greater than the standard $15,200, but most seniors took the standard amount.
Starting in 2018, the personal exemption is completely gone. It is $0.00. However, the standard deduction for that same senior couple has increased to $25,300. This means that $2,000 more of their income is not taxed at all. Here is a summary of those changes-

For a Senior Couple aged 65+20172018 Change
personal exemption40500 -4,050
Total personal exemptions for senior couple81000 -8,100
Max standard deduction for senior couple$15,200$25,300 +$10,100
Total of Exemptions + Deductions$23,300$25,300+$2,000

Are any of your Social Security Benefits Taxable?

It sounds silly that one branch of the government is giving seniors their Social Security benefits while another branch, the IRS, is taking part of it away in taxes, but it is true in some cases! If Social Security is your only source of retirement income, it is almost certainly not taxed. However, you may have to pay taxes on your Social Security benefits if you have other retirement income (pensions, a 401-K, even a part-time job).
Here is a quick calculation to use in planning –

  • Take all of your non-Social Security Income and add ½ of your total Social Security benefits. That total is a figure the IRS calls, “combined income.”
  • If your combined income is greater than a threshold amount, you will pay some tax on Social Security benefits.
  • For our fictional senior couple filing jointly the threshold amount is $32,000. For single filers, it is $25,000.
  • If our senior couple received a total of $28,000 in Social Security benefits, then ½ X $28,000 = $14,000. That means that they can have a total of $18,000 of other income before they start paying taxes on Social Security.

Does all of this sound complicated? It can be intimidating, especially to seniors who have not had to deal with these changes or problems before. A tax professional can help you do this and the Ourseniors.net website can help you find qualified and knowledgeable tax and accounting help. Check these links –

Besides help with tax and accounting questions, OurSeniors.net is here to help with the many other challenges and opportunities involved in senior life transitions. Please look to the OurSeniors.net Senior Transition Pro Team for professional legal, medical, real estate and financial advice. The OurSeniors.net Directory of Approved Vendors can steer seniors to vetted, dependable services in many areas.
Our many contacts and service areas include –

  • Senior home care
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  • Florida CPAs
  • Senior real estate specialists
  • Financial advice for seniors
  • Memory care living

You can contact an OurSeniors.net Advisor by phone at 866-333-2657 (se habla Español), or by using Contact Us. Check out our website at OurSeniors.net and take an online look at our senior living magazine, OurSeniors.net Magazine.

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