No Tax on Social Security Income? The Truth About Trump's Plan and What It Means for You

[@dodgermartin4895]

I'm a CPA and here's my gripe... The gov't takes 6.2% of almost every person's salary, and the employer kicks in another 6.2%.... that's 12.4% of almost every employee in America's pay!! That's a lotta money!! The employee doesn't get a reduction in taxable income for his 6.2%... and then the gov't has the nerve to tax the benefits again when he collects sometime after age 60. And any notion that the SS Trust Fund will ever go insolvent also riles me up... WHY? Because the Gov't robs the Trust Fund to spend it on other stuff. Is the answer to keep double taxing everything.... or for the gov't to stop spending so much.

[@bobmcgehee1749]

100% correct

[@pgithens1]

They are always looking for ways to get more tax dollars. Never looking for ways to reduce spending.

[@alansach8437]

Most people will never pay federal tax on their benefits. Those who do are higher wage earners, or those who take their SS early and then continue to work, and make over a certain amount. The tax goes back into the system yo shore up the SS Fund.

[@paulpeterson4216]

The SS Trust Fund does not need shoring up. Yes the system is not fully funded past 2035, 2034 if the proposal goes through. Nobody freaks out that the Department of Defense is not funded past early 2026!!! The simple solution to social security solvency (3x real fast) is to lift the upper limit on the payroll tax, or for Congress to just appropriate funds. The proposal to have incomes over $400,000 taxed the same as incomes under $116,000 is pretty easy.

[@KevinG-159]

You nailed that DM! How about continuing to pay SS tax after the 165,000 (approx) income cap? I'm sure it would help since many are above that nowadays.

[@MelvinLynn-q4w]

Absolutely Social Security should not be taxed on the federal and state level. Wow! What a rip off!

[@DT-abcd]

Only 5 states does that

[@archmasterone]

We need to be taxed on social security if not there wouldn't have enough for Ukraine or the Israeli people. If fact cutting 25% off of social security benefits would allow more money to help support all of the illegal aliens who entered the US.

[@RawGreySun]

@@DT-abcd What 5 states?

[@better_together-w4m]

@@DT-abcdit’s not a state program, but a National program. Social Security is taxed in all 50 states.

[@dera6347]

Thank the Reagan Administration, in April 1983, for that.

[@michaelroy925]

There absolutely should be No tax on Social Security benefits. It is unfair to put such a financial burden on our seniors in retirement

[@TheFirstRealChewy]

It sounds nice, but the money is going to come from somewhere else. It's not magic. So they either cut spending on something or collect more in social security tax while you are working. That increase will likely start with taxing all income with no limit (similar to medicare), then extend to raising the amount taken from your paycheck by 1-2%. Alternatively, they can choose not to tax the benefits while also paying out less benefits. Keep in mind that those with very low income in retirement are already paying very little taxes, if any, on their benefits. So a reduction in benefits will impact these people even more.

[@bryanwhitton1784]

I am not so sure about that. Yes, the employee have has already had taxes paid on that income. But the employer half hasn't. So, while I like the idea of not paying taxes on SS benefits I could argue for taxation on half of them. Boy, this is all becoming very real for me. I turn 70 next month and start receiving my SS on January 8th 2025. I will become gainfully unemployed. 😉

[@byronbuck1762]

Bull. We use government services like everyone else,even more considering social security and Medicare. Why should we be exempt from helping to pay for it?

[@bryanwhitton1784]

@@byronbuck1762 I am not sure I understand your response. How does the use of government services have anything to do with double taxation?

[@shawnbrennan7526]

Many seniors are NOT burdened in retirement. I think it’s great to discuss where to start taxing SS, but not taxing it at all is naive.

[@johnburris7711]

No tax on Social Security! I've paid in for 47 years, and been taxed on every dollar already. The government has taken ENOUGH !!!

[@garymartin9777]

you have not been taxed on the matching employer contribution and neither was the employer.

[@justkeepingitreal2024]

@@garymartin9777 Unless he was self-employed, then he was both the employee and employer and pays both "contributions".

[@HughButler-lb6zs]

@johnburris7711 for democrats, you never pay enough. They were talking g about taxing you on unrealized capital gains. It looks like that may happen in California. But when it comes to taxes, Californians are easy.

[@HughButler-lb6zs]

@@garymartin9777 that is an absurb statement.

[@JoIn-y5s]

I paid into SS for 42 years. When I retired, I was making $140,000 a year ($11,666 per month before tax/insurance). I get $2,200 a month in SS BEFORE tax and insurance ($1,630 after tax and insurance). THANK GOD I saved for retirement. $1,630 doesn't even cover the property/school taxes we pay here in PA. So how did SS help? It pays tax. America is a mess when it comes to taxes. Historically, every world power that taxed above 25% failed. You are paying 70% tax if you include everything. Even your utilities are taxed. That's right, we work 8.5 months a year just to pay tax. Even worse, our politicians just throw the money away. JUST FYI- I AM UNDER WEP. LOOK IT UP IF YOU ARE WONDERING. BASICALLY IT MEANS IF YOU GET A GOVERNMENT PENSION, YOU CAN ONLY DRAW 60% OF YOUR SS.

[@larryhand7219]

After pension and withdrawal from salary saving plans my wife and I are taxed 100% of our SS benefits

[@yannip2083]

When you retired, if you didn't "work" and make $140K, would you then get your full SS of $2,200 a month? You mentioned your SS after tax and insurance was $1,630 - is that because you were retired but you were still working and making $140K? Just trying to understand how this works.

[@mikedilts4346]

So when is the government going to pay back the money it took from SS

[@richardlicht7927]

I don't understand why you are only getting $2,200 a month. I am collecting $2,283 a month at 62 and I never earned $140,000 a year. The most I ever earned was $106,000. My last 8 years I only earned about $25,000 and before that I was out of work for 4 years. Did you earn a lot less for many years?

[@TERRY-cb2ku]

​@@richardlicht7927I think he's saying part of the taxes he paid are going to people who were lower earners.

[@DaveB-w2i]

I love competent KZbinrs who have accurate and informative information. Another great video.

[@charlesyoung7436]

I have one quibble, though. The "one minor adjustment" in 1993, was nothing of the sort. Thanks to the Clinton administration, higher income retirees saw their tax on Social Security go up 70% (from 50% to 85%) with no indexing for inflation, of course.

[@JohnW118]

@@charlesyoung7436 ...and it was all started by R. REAGAN. don't go blaming a democrat for this mess...

[@DMJ160]

@@JohnW118 LOL.....John!!!! Please, for the love of God! Do your research before typing your ....opinion. Let me educate you SIR! Representative Daniel Rostenkowski (D-IL-8) introduced H.R. 1900, the Social Security Amendments of 1983, on March 3, 1983. The bill was signed into law by the President on April 20, 1983, and became Public Law No. 98-21. Notice the "D" after Daniel Rostenkowski name????? It stands for Democrat. So, Daniel introduced the 1983 bill. Yes, Reagan signed it but it got started by the DEMOCRAT!!! Thank you, have a good day!

[@dalspartan]

@@JohnW118 it was a compromise negotiated, Reagan upheld his end, Democrats did not cut spending as they promised. Knowing history is important.

[@charlesyoung7436]

@@JohnW118 I did not blame Democrats for "this mess," because the initial bill to tax 50% of high income SS recipients was a bipartisan compromise. The addition of the higher 85% bracket (a 70% increase) was all Bill Clinton's doing in 1993.

[@ronaldhays5903]

Social Security distributions should not be taxed. The funds to support solvency should be contributions from active workers. Nobody likes paying taxes but I believe anyone would prefer to pay more while they have active income instead of paying on a fixed income. Great video. Thanks

[@TimothyStclair-v4p]

FDR did not have them taxed.

[@thomasgusich1368]

Too many drawing ss and don't pay into it,gov should learn to live in a budget

[@paperburn]

@@Dave-hb7lx I would love to see one of those R work a trade job at age 69.

[@paperburn]

@@thomasgusich1368 SS is indexed to your tax returns. You do not pay in you do not get paid out. You can literally have a SS check of 50 dollars a month if you just barely meet the requirements of 40 quarters (10 years) and only worked those 40 quarters at minimum wage. I have no idea what your talking about. SS was set up under the premise that you would work 35 years or more. SS was set up under the idea you would own your own home . It was intended to make sure you had the most basic requirements for life and nothing more.

[@raydelv]

If the government is taxing social security income, does that money go back into social security or into the general fund? The other issue, social security runs like a Ponzi scheme. Instead of luring investors, it makes you pay into it. The profits or the payments go to earlier investors or recipients with funds from more recent investors or payers🤷‍♂️ The American family has shrunk. My parents had 12 to 15 siblings. My parents had 6 kids. Today the average family has 2 kids. Those kids are paying for the family of 6. If you get hired today by the Federal Government, or serve in the military part of your pension is calculated by a TSP, Thrift Saving Plan. Similar to a 401k. Social Security should have a similar option.

[@kirkstevens1502]

Who doesn't love bloopers?! And freckled shoulders, right?! My 1st view of your channel. Totally loving the simple, straight-speaking format!

[@williammiller5575]

As a retiree I am opposed to double taxation. Social Security should NOT be taxed.

[@aolvaar8792]

You did not pay Tax on the 6.2% that your Employer paid.

[@williammiller5575]

@@aolvaar8792 My employer was the United States Government. I'm Vietnam era veteran of 33 years, what you are suggesting makes no sense.

[@aolvaar8792]

@@williammiller5575 The 6.2% the Government paid for you, was not taxed. That is why you're being taxed for it Now.

[@aolvaar8792]

@@darwinchapmam6343 At $80K retirement, $20K of SSA is taxable. My wife and I aren't RICH.

[@MarcCalvert]

Thank Ronnie Raygun

[@TomR-GentlmnFarmer]

Thx Erin for bringing attention and awareness to the fact that the taxable income thresholds have never been indexed. That in and of itself is an egregious and unforgivable intentional act by our Govt.

[@byronbuck1762]

@@TomR-GentlmnFarmer Nonsense. It was a deliberate way to raise additional revenue over time which was seen as necessary due to changing demographics where we have fewer workers paying in and more taking benefits. The revenue had to come from somewhere

[@ALexMcDunny]

@@byronbuck1762 If I understand the issue, everyone has the exact same cap on SS payments. I'll make up a number like 100k max. If I make more, I stop paying in since I have met the max. If I make $40 million a year, I have the same number as I did when I made made 100K so the 40 million dollar version of me has not paid anywhere near the same % as the 100k me.

[@GregoryBenson-d2c]

Social Security was to support the individuals during their retirement years not to support federal or state governments. All Social Security income should be tax exempt.

[@greggpurviance7252]

Agree. It was to supplement. It's purpose is Suplimental but then take it away. Dumb

[@MattDapson]

Take your rose colored glasses off and prepare for a benefit cut. Without MORE taxes, the program goes negative in a decade.

[@AllanKunda-mp5xs]

@@MattDapsonthat is why you take social security as soon as you turn 62, no guarantee from anyone on what is going to happen in 2034, no administration is touching it as of yet!

[@jdgolf499]

Was never designed to SUPPORT individuals, it was meant to SUPPLEMENT your income in retirement!

[@bricefleckenstein9666]

Talk to Oregon about why their "taxable income" threshold is LOWER than the income of people on SSI. FED "don't have to file" threshold is notably higher than someone on SSI is paid. I suspect there might be a few other states with the same issue.

[@NolanGouveia]

This was really well done Erin!

[@ErinTalksMoney]

Thanks Nolan! 🙏

[@JudyFrommes]

Great explanation of the ss. program. I think the ss. program needs to be updated to include inflation indexing. But another thing that needs to addressed is to get the ss. funds back into its lock box trust account, where the funds where suppose to be, and not be loaned out to congress on IOU. certificates put in files. Congress has to keep its hands out of the ss. trust fund money for other programs. another issue that needs to be addressed is that all politicians and federal employees must be required to pay into the ss. system.

[@garymartin9777]

you listen to much to Al Gore. There was never a lockbox. In fact the 1935 SS act requires all excess SS monies be used to purchase US treasury securities, at interest, and it has always been done so. if there was a lockbox the trust fund value would be ravaged by inflation. is that what you want? all congress-critters and federal employees have been paying into SS since 1984. try to keep up.

[@glennorrell3446]

Definitely agree that they were deliberately not indexed for inflation.

[@dawightg9787]

Very good video, and eye opening. Social security at the very least should be indexed to inflation and removing taxes on social security during ones ending retirement years is common sense. When a senior citizen gets to that age taxes should be a thing of the past.

[@isoawe1888]

Very informative. Thank you. I am definitely on the no tax side of argument. I also believe that if you have never contributed to the system, you should not be eligible for benefits. It’s suppose to be paying us back, not paying us.

[@xraargu6212]

👍👍👍👍👍

[@tscoff]

Congress seems to have mastered the art of not indexing taxes for inflation.

[@MrsWhite390]

Assets that can make one successful in life

[@MrsWhite390]

I. Forex 2.Stocks 3.Shares

[@MrsWhite390]

forex is profitable and lucrative investment online

[@YhBb-l8y]

​@Wine552It's not ignorance but unprofessional broker in the market

[@YhBb-l8y]

Natural, there's a lot of math involved in forex trading. but this is often presented in forms of daunting technical charts, indicators, patterns.

[@kevinleming194]

We are taxed on EVERYTHING!! It all needs to be reviewed. Money we earn, money we spend, money we save, property we own…etc. Plus it’s at the federal level, state and local levels. It all needs to be reviewed. The Federal government is so bloated and wasteful.

[@Fruit17-ip4vl]

They do not want you to have anything.

[@MsReasonableperson]

@@Fruit17-ip4vl Please don't be so ridiculous.

[@Fruit17-ip4vl]

@@MsReasonableperson I’ll try to be more positive.

[@Etron49]

Elon Musk is on the way thanks to President Trump .

[@Pseudify]

There are viable systems that could eliminate all this mess and simplify life for everyone. The Fairtax is one such proposal. It would essentially replace all federal taxes (income, payroll, estate, etc) with a single national sales tax of about 21% on all services and new products at the retail level. This has been shown to be enough to replace all that revenue. It would completely eliminate the need for individuals to file taxes and it would eliminate most of the IRS.

[@WolfmanJim68]

No one should have to pay taxes on their benefits they they already paid into!!! If the government can keep their hands out of SS and slow down their spending everywhere else, I believe this country would be in a lot better shape.

[@gbinman]

do you feel the same about the employer matching funds that were not taxed?

[@libation14221]

After the tax changes in '84 the huge surpluses that were generated got stolen by the shitheads in congress and replaced by some crappy special issue bonds.

[@phillyboylaboy]

U r right. DOGE cometh. 😊

[@johncombest6180]

Agree with your 1st point, "keep your hands off." won't solve the problem. Simply index ALL SS to inflation. The "fix" is, retrospectively, indexing the Tax on SS in retirement.

[@kito1san]

Technically, you won't pass the max for taxes to set in even if you took the delayed payout at age 70. Of course if you have other source income is capital gain. This is true except 8 states which taxes ssi without a maximum. Why that is who knows.

[@tolson57]

Thank you Erin. This is the first video of yours that I have watched. Great work. Clear content and presentation.

[@rab52764]

Erin, you are a magician. I've been watching and learning from you for quite some time, and even with a sensitive topic like this I still have no idea what your politics are - which is exactly how it should be for a financial advice channel! Great job!

[@ErinTalksMoney]

I work very hard to keep any of my political beliefs out of these videos. Because I think the whole point of my personal financial platform, is that people can make informed financial decisions about their situation. My political leanings have nothing to do with that overall message. 😊

[@Mr.Slade62]

@@ErinTalksMoney Agree with @rab52764's comment, Great job!! This subject needs talked about so much more!! I am 55 and have no idea what to expect in 10 years if BIG GOVERNMENT does not keep its hands off the monster IT created. Largest pyramid scheme in history !! Like the soap company and vitamin companies that do the same structure, so those at the top get rich while those at the bottom does all the WORK, whats that company ?? AMWAY?? SOAP?? Well my opinion ... with no liberal college brainwashing.... its GOVERNMENT that wants to keep us broke no matter what stage of life we may be struggling with. All because they have forgotten the boundaries set by the constitution as to what POWERS they are given. WE THE PEOPLE have the power but they do not educate the people on what powers we do have so they can STEAL that as well as the funds we all work hard for, some even die prior to receiving any benefit !! Does what you paid in go to your FAMILY?? NOPE .... I wonder what happens to those funds to those who pay in but never receive a damn cent!! Poor processed foods, heart attacks, Obesity due to the cheaper the food the worse it is for you!! Constant doctor apts.... they want us all dead before any payments are received!!! A close friend retired at age 62 and six months later .... he left this world and his wife, they were raising his 3 grandchildren .... what a mess I pray for TINA every day!!

[@paulg2132]

This topic is at the top of my mind because I'm just over a year away from retirement. It's probably the most complicated transition of our lifetime. Thanks so much for all your help! 🙏

[@gbinman]

I hate to burst your bubble. I have been retired for 20 years. It continues to be more complicated each year. I have been dealing with multiple RMDs which increase my income and my taxes. I am an active market trader. I am up an "unrealized" $268k and working to move the gains into future tax years. My wife's retirement income is increasing. We took a hit when she sold her condo a couple years ago with a large capital gain. I learned about IRMA then. Getting older isn't always about being poor and eating cat food.

[@JuanMartinez-kn2qs]

I have seen many talk about this topic. You are the best explaining. Hopefully, we can fix it in the near future. Thanks

[@darrinpayne27]

As a tax professional one of the greatest hidden tax accross the whole tax system is all these limits and caps congress puts in place and never indexing them for inflation. The taxing of social security is a perfect example. This discussion on the taxing of social security benefits as I see it comes down to a choice between what is right and what is necessary or practical. The right thing would be to make the benefits totally non-taxable, unfortunately congress has spent all the trust funds that were supposed to be set aside. Inlight of the funding issue I think the benefits will need to be taxed on the higher income earners to help keep things solvent. Obviously, this would not need to happen if our government could eliminate over spending.

[@janebishop5885]

You do an excellent job of explaining all the issues and nuances. SS benefits should not be taxed and you are right that failing to index income thresholds was deliberate, not an accident. Also, I would suggest you factor into your analysis that health insurance benefits provided by the company are deductible so is really income to the employee that the employee never pays taxes on. So, in this way, there lies another contradictory aspect of the rationale of taxing SS benefits.

[@bl300zxx]

LOVE THE ENDING BLOOPER.......MAKES IT VERY ENTERTAINING.thanks for the great content

[@Iffy50]

"a stealth tax to include more people over time". Agreed!

[@itsJoshW]

It was an interesting quote, but when you look at it in a political standpoint, dems in both houses have been trying to make SS taxation shift with inflation. It's specifically that it never gets voted on, and it never moves anywhere. Reading between the lines, the future holds the possibility for the states to be put with the burden of social security, and thus define that certain states will increase "state tax", or simply not support it. Or, it's also likely to have nothing happen to it at all because they are just using campaign talking points to get people to click "yes" so he can golf for 4 years while collecting money.

[@hardcount5412]

Sounds like AMT

[@billmorales6432]

You can thank Ronald Regan for this. His trickle down economic theory has left the blue collar working person left out in todays economy and led to the rise of the MAGA crowd in search for their share of the pie.

[@oliphauntsneverlie6227]

@@billmorales6432 BS. Go back to bed leftie.

[@Wild1BillS]

@@billmorales6432 Do you need a hanki to wipe away you tears from the Bimbos loss ?

[@TheBeer4me]

I have to laugh about the thing about social security people View social security ITS NOT A RETIREMENT PLAN! It’s to keep people from being destitute! We should all be paying social security on each and every dollar earned and not have a cap on income. A lot of people don’t realize over about 250,000 isn’t subjected to social security tax that is ridiculous. The problem is the ones making the laws are the same people that make over the threshold. They have insensitive to change it! There should be more videos like this. Good job!

[@Timpechoes]

It absolutely should be re indexed to our current date and economic situation.

[@Emthon]

Erin, I am glad you are addressing timely and important issues of the day! Thanks for your straightforward and understandable explanations of money matters. Your “bloopers “ are so endearing!

[@davidsteinberg9523]

love the blooper reel. I needed that this morning.

[@joeo7693]

I subscribed just because I love the fact you put outtakes at the end. Too funny. LOL

[@ErinTalksMoney]

Woo-Hoo!!

[@sassyd7286]

Yep but it’s not just those whose retired. Many older folks are still having to work PT jobs while getting SS, because it doesn’t cover cost of living enough - not even close. If you could also talk about those that are permanently disabled, when discussing SS. We are always forgetten about in these discussions, keeping society unaware of the millions of us affected by this. More awareness will also force the government to be accountable to their disabled & chronically ill, that aren’t retirement age. Thank you 🙏🏼

[@billsmith8339]

I am single, 73 years old, and still work full time (about $51k/yr) to keep busy, otherwise I would just sit on my butt and watch KZbin 24x7. I, of course, receive SS (about $36k/yr) and admittedly make a decent living. But I think it is unfair and I really resent that I have to pay SS taxes on my wages plus I have to pay income taxes on both my wages and SS ... And regardless of what the intended "purpose" was to begin SS, it has become the de facto retirement program. Had the Government kept their hands off my and everyone else's money, there would be no impending SS crisis. Maybe all the Government politicians should kick in all their double, triple, and quadruple dipping pensions into SS so they have to worry, and then we'll get a program that's beneficial! The same with health care, have these same politicians get the same health care as we do, and that crisis would also be remedied quickly!

[@Satjr35031]

Do you understand how Congress qualifies to receive a pension. ?

[@billsmith8339]

@@Satjr35031 Yup ... basically after 5 years of service, they are eligible for a pension using the best 3 income years and also depending on their age. But they can stack pensions i.e. state, federal, etc.

[@robgrey6183]

@@Satjr35031 Who cares? They write the laws to exempt themselves from almost everything we have to pay.

[@HughButler-lb6zs]

@billsmith8339 there would be a funding crisis because congress planned poorly for paying social security benefits. It is demographics that is causing the funding shortfall. Actually the government borrowing money from the ss trust fund improves SS solvency because the govt pays interest on the loan.

[@jthepickle7]

70 year old award winning finish carpenter here. I think people would be happy to have my services. It took a long time to get this good.

[@robgrey6183]

Work for cash. Avoid taxes. Learn from the M****i*c*ANs/

[@md168]

As always a good vibes and a good share Erin ❤

[@HopeToProsper]

Great explanation Erin. I have always wondered why SS gets taxed at such low-income thresholds. As usual, the middle class is getting screwed. My recommendation would be to keep the SS tax, but to bring the index current and adjust it for inflation in the future. Retirees making over $108K per year can likely afford to pay some income taxes on their benefits, while retirees making $44K likely cannot.

[@MattDapson]

Ah yes. Tax others, but not me. An American theme.

[@zooeyglass7643]

Willing to bet you will have less than 108k a year. What a coincidence! What I can afford and what you deserve are 2 different things. I have put over 1/3 of my income into retirement savings for over a decade. Guessing you haven't. I do not owe you a damn thing.

[@HopeToProsper]

@@zooeyglass7643 Yes, I will be making more than $108K when I take my SS and I am willing to pay some taxes on it.

[@HopeToProsper]

@@MattDapson Yes, I will be making more than $108K when I take my SS and I am willing to pay some taxes on it. I am fortunate, but many are not.

[@codeguy112]

Don’t care how much retirement income I make, it’s not taxable period.

[@LegacyStacker]

Hi Erin! Great video! I didn't know that SS only began being taxed in 1984. As a content creator, I also enjoy the bloopers! Keep up the good work! 😎🏆

[@craigpajer1845]

Joe Biden joined a bipartisan effort to make 50% of Social Security benefits taxable, for those above a certain income. This new revenue would go towards the Social Security Trust Fund.

[@kayakdan7013]

I would not mind seeing another re-indexing and a plan for future years to continue to index for inflation. The insolvency issue needs to be solved some other way, because taxed or not, it will still be an issue.

[@motomike3475]

1st you have to take the welfare aspect out of the SS. What you put in, indexed to the DOW, NASDAQ and Russel 100, plus the price of gold and silver (to cover gov printing inflation). No more no less. And portable. And no exceptions for buying a house, a car, big Pharma drugs, Big Macs, and streaming services, which all will try to carve out exemptions for you to spend all your money and die broke anyways. A non taxable Roth IRA is the best way. And mandatory option for self directed with a mandatory opt in, and optional opt out clause. Not the reverse.

[@ScottyMcYachty]

Very educational and informative. Thank you.

[@gregoryhaines1138]

One item that I didn’t see mentioned is after a certain threshold ss stops being withheld. It should not have a threshold so 1million earner a year pays 62k plus the 62k from the employer.

[@jdgolf499]

Idea for a future video. Might want to explain "provisional income," which is what is actually used to determine tax on SS. In the calculation, you would use only 50% of SS income, so in this example, only $18,000 is used in the calculation. So, that $18,000 would be added to their 401k distribution, not the full $36,000.

[@sandrat8190]

The Retirement Nerds KZbin channel did a great video on provisional income 9 months ago.

[@larryolson6464]

I was going to make the same comment - her example is not correct, which unfortunately just adds to the confusion.

[@JeffHeelan]

Based,on the corruption that we have seen in our government leaves me to want to invest the social security on my own.

[@johnholfelder6724]

I believe Barry Goldwater suggested that years ago. He was vilified for it

[@doug8718]

Great info. Love the bloopers!!

[@n539rv]

Thanks for the insight on this. Income Tax does not fund SS so taxing SS is simply a diversion of funds. Makes complete sense to correct the taxing threshold which would solve this issue for the vast majority of us seniors.

[@RS-lw9cd]

Good information, Erin. Thanks for the video. One of the big problems with people is that they do not plan for retirement. Many, live for today, not thinking about the future. When they finally do start thinking about it, they have lost the most important thing, TIME. And, that is one thing you can never get back. If planned early (and acting on the plan), they could have all their ducks in a row and be financially ready for retirement. Social Security was never meant to completely pay for people's retirement, but was meant as a financial supplement for retirement. As long as people plan (and act) for retirement early in their working years by just investing/saving money for retirement early (and being consistent with this), most will be able to retire comfortably. It would be nice if the Trump administration can do something, even partially, about reducing taxes for those of us that are paying on 85% of our S.S. benefit. However, I doubt if anything is going to be accomplished because of the poor financial position of our current S.S. system. In fact, I can envision that Congress may make changes to reduce benefits since S.S. is running out of funds. I don't think Congress will reduce benefits of those that are already receiving benefits, but, more likely, the possible future changes will affect those currently working.

[@charlestreibley9904]

Tell your Entitled View to those whom live their entire lives work Minimum Wage and see how that pans out, Soft Hands!

[@RS-lw9cd]

@@charlestreibley9904 I grew up on a farm. I had to wake up and go out into the fields at sunrise and do manual work (with, what you call "Soft Hands!") until I had to go to school. Attended school and then came back to the farm after school and worked in a packing shed to prepare boxes/crates for produce packing for the next day. Then I got to go home to eat dinner and do my home work. All manual work, five days a week during school, and every Sunday (except I worked all day since I did not have to go to school on Sunday). My only "rest" day was Saturday because there was no produce market on Saturdays. I did not get paid for this (except room and board). I knew that I did not want to do that the rest of my life. After high school, I put myself through college by working at a grocery store, and started there by mopping floors before the store opened, and then was a box-boy during the open hours. Oh, and I was getting minimum wage at the grocery store. It is easy for you to condemn people that you do not know and have no idea what they did to get where they are today.

[@robannmateja5000]

@@charlestreibley9904 , yes, personally, I hate this kind of lecture... "if only you had planned better". I consider myself very fortunate to have had a career affording me the possibilities of building a good retirement portfolio. Many people don't get these opportunities. Not all jobs have these benefits, and even those that do- it can be hard for many families struggling to put food on the table and afford essentials such as insurance, let alone fund retirements. That doesn't mean that they should be exploited, as the current system does. Seniors form the most vulnerable segment of our society and we need to treat them better.

[@tommybotts]

@@charlestreibley9904 Working one's entire life on minimum wage is a poor life plan.

[@byronbuck1762]

@@charlestreibley9904 failing to better one’s position in life over an entire career doesn’t entitle you to other people’s money

[@martinyeager7948]

Bottom line the government needs to stop deficit spending and start paying down debt. I don't like paying tax on 85% of my Social Security. I don't like the impact my RMD will have on Medicare IRMA. As usual you concisely bring up very good points. But, just like in our personal finance rules, the government needs to either reduce cost or increase revenue or BOTH.

[@darbyohara]

😂 why? Like voters are gonna put them up against the wall like they need to learn 😂

[@thomasreedy4751]

If you don’t like RMD’s maybe you should roll over to a Roth IRA. I feel like you are just trying to avoid paying taxes. We should pay our fair share.

[@tgunnarson]

@@thomasreedy4751 - what's a "fair share"? Please post a link to any politician or financial SME providing an actual rate. I've seen several being asked and they never give a rate.

[@davelively7423]

Most people believe the "easy" solution to SS's fiscal problem is the one that increases or does not reduce their benefits in any way, does not require them to contribute so much as an additional dime to keep SS solvent, and is 100% paid for by someone else. Nice to see a few people like you realize everyone that benefits from SS needs to contribute to keeping it solvent. If we want to maintain wide spread support for SS fixing it need to require all participants contribute to the solution, except for low income beneficiaries that truly cannot afford a cut. A combination of higher taxes (increasing the FICA cap, etc.) and reduced benefits (taxes on SS, increased retirement age, etc).

[@utubewillyman]

@@thomasreedy4751 My guess is you pay the minimum you're required to pay, just like the rest of us. But the pontificating gives you a pass on feeling bad about it.

[@jeradim1]

Thanks for the explanation Erin. I really enjoyed watching and learning. You made it interesting. Looking forward to watching more.

[@dera6347]

Social Security began being taxed during the Reagan Administration, in April 1983. Social Security is not a savings account you get back after you retire. All those currently working are paying those who are currently collecting. All that money you paid into the system has gone to someone who was collecting it at the time. There are many who never get Social Security, due to not living long enough, and they also paid into it. Although you do not get back what you paid into it, what you pay into it does determine how much you can collect from it. If one does not pay into it, they are not allowed to collect it.

[@DMJ160]

Yes, For anyone blaming Reagan soley over taxing SS. It was introduced by Democratic representative Daniel Rostenkowski (D-IL-8) introduced H.R. 1900, the Social Security Amendments of 1983, on March 3, 1983.

[@dera6347]

@DMJ160 it was a bipartisan vote that did not reach 2/3 majority. Reagan could have vetoed it. Regan was the one that told congress to come up with something. Yes, this is on Regan as he asked for a resolution and he could have vetoed it.

[@DMJ160]

@@dera6347 Yes it was bipartisan. But to simply only mention Reagan is a bit unfair. It was a democrat that came up with the idea.

[@dera6347]

@@DMJ160 Well it was a Republican that came up with the idea to withdrawal from Afghanistan, and even began that withdrawal. However full blame is put on the Democrat that finished the withdrawal. At least you are acknowledging that what one PPOTUS does carries over to the next, in this case anyway. Reagan could have stopped it on his day 1, but he decided to continue with it. Reagan fully allowed it to continue.

[@DMJ160]

@@dera6347 lol, only problem with Afghanistan, no republican was involved with the actual withdraw. We have seen what the last 4 yrs have been like. Democrsts made it pissible for Trump to win from the shit show they displayed last 4 years

[@ToddMathis-fg1pn]

This is why I tend to despise BOTH parties!

[@robert953]

Government gets 85 billion dollars in interest on social security and 35 billion in taxes. So, 120 billion dollars on top of the money we pay in!

[@bill6732]

Explain how they make interest on money they don't have.

[@Satjr35031]

SS pays out $108 billion a month. FYI

[@eaflom]

Great work and fun outtakes

[@BlaiserAid]

Thanks for the clear-eyed explanation. Love the outtakes at the end! OK, my wife and I pay income tax on our SS benefits. I don't like it any more than anyone else, but taxes are the price we pay for civilization. My opinion is that the SS tax brackets should be adjusted now and tied to inflation moving forward, so that, as you said, the SS system stays more on track to it's original purpose. That will certainly reduce revenue. That loss in revenue can be recouped by doing 3 things: (1) increase the FICA threshold so that people who are better off (have higher incomes) pay FICA on more of their income. Where exactly you draw that line is up for debate. (2) The FICA threshold does increase over time, but it doesn't seem to keep up with inflation.If it's not pegged to inflation, it should be (3) We might consider raising the tax rate limit on SS benefits - that's the 85%. But I think a better candidate is to make the general income tax rates more progressive - higher rates for higher incomes. I say this for 2 reasons: (a) we would simply be going back to the rates we've had in the past. Again, the rates are debatable. Some say that will reduce economic growth, but IMHO that's nonsense. We have had good and even great economies when those higher rates were in effect. And (b) The VERY well off have had a HUGE windfall over the last couple of decades, as the taxes were reduced - precipitously in my view. The pendulum has swung too far in their favor and it's past due time to make things more fair. You want to make America great again? You do that by getting us back to a strong, vibrant and LARGE middle class, which has been decimated again and again by tax breaks for corporations and the wealthy and sluggish wage increases that don't keep up with inflation. For what it's worth, we are not "wealthy", but we are "comfortable". The things I suggest above will significantly increase my taxes. But I come from a lower income working class family, and I firmly believe that that trickle down economics does not work for the middle class (but it;s GREAT for the wealthy). I also believe that I made it into the upper end of the middle class because of such policies. America has a HUGE economy; there's plenty to go around if we just stop funneling so much of it to the top 1% and invest in our country so that our children will be able to experience a booming economy and a decent financial life. Just my $0.02 ...

[@LarryDMitchell]

"That loss in revenue can be recouped by doing 3 things:" How about #4 - Congress should spend LESS! #5 Presidents should have line item veto for the budget. Some of the stuff our tax $$$$$$ is spent on is useless, including all the money we send to other countries, especially those who hate America! Just my $0.02 too!

[@rightshotphotography2576]

Social security INSURANCE! Insurance payouts are typically not taxed. I’ve been paying in for almost 50 years and it would be nice if it were not taxed!

[@grega2362]

Its not insurance. 1937 SCOTUS ruled (Helverning v Davis) that the govt cant run an insurance program and that all of the tax goes to the general fund and is not earmarked in any way. Its an IOU that they have no legal requirement to give to you, knowing that any politician who has told you that it is in a trust fund is a bald faced liar makes it eaiser to understand how they give our money away under the guise of SS to whomever they want to .

[@DESKWERKSJB]

My dad left me, and my sister, life insurance after he passed. The 50k was taxed before distribution.

[@todddunn945]

@@DESKWERKSJB Normal life insurance paid for by the insured person is not subject to tax at the federal level. If it was a group/term policy paid for by his employer it can be subject to tax since it is counted as an employment benefit by the IRS.

[@seminolefantodd4736]

Eliminate the cap on FICA tax and the tax on SS benefits.

[@andrewdiamond2697]

That would then call for an elimination of the cap on how much Social Security could pay out. It would be better to simply leave the cap and fix the tax brackets so that income tax would go up 6.2% higher on income above the cap. That would also help the federal deficit.

[@jhmrem]

I agree about no FICA tax. I don't even mind the tax on SS benefits per se, but it should have a way higher floor and no upper limit. And if you're both working and receiving SS, at least credit the FICA tax against the SS tax.

[@TheFirstRealChewy]

Eliminating the cap on FICA tax won't have much of an effect. Jist think about it. What percentage of the population has taxable income that's above the current limit, and how much above the limit? Due to marginal taxes these people are already paying a fair deal in taxes on every dollar past the limit, and we haven't even included state taxes. The people that make a lot of money past these limits are usually making it via investments that are taxed differently. So then they are looking at long term capital gains. The government also don't tax that too much because that's usually money that creates jobs.

[@bradk7653]

Only if those that pay taxes on the higher income also get higher benefits. Otherwise it is just another form of welfare.

[@ron8566]

Super excellent video. Thank you.

[@zeldyrrolorin9962]

One piece of advice that my dad told me many many times was to treat SS tax as a tax and assume you will see zero dollars in return. When do retirement planning I follow that advice. The assumption is that either the whole system will fail or my benefits will be taxed to zero in the name of equity. Taxing social security benefits, as you noted, adds more complexity to an already complicated tax situation. KZbin is filled with videos on retirement tax planning with complex methods on how to avoid this tax. The people who benefit the most from this are CPAs that can legitimately tell (scare?) seniors "It's too complicated. You need to hire me or you retirement will be ruined by these taxes." They even use scary analogies like tax torpedo. Some people have a romantic fascination with "equity". In the real world it always ends up causing opportunities for graft and other severely negative consequences.

[@bobmcgehee1749]

Thanks for pointing out they actually stole our money.

[@KaeHwang]

DOGE should focus on protecting and growing the SS fund paid for by the tax payers. The biggest problem of all government inefficiency is their mismanagement of the SS program.

[@garymartin9777]

how are you proposing to increase the trust fund? oh, more taxes!

[@alansterling3481]

Congress will NOT eliminate the taxes on Social Security without making it up somewhere else. I worry about the where else....... Politicians do not let go of revenue sources!

[@FreakyLynx]

The crazy thing is they’ll always spend more than tax revenue provides, we’re currently printing/borrowing trillions more each year than what revenue brings in. We don’t have a revenue problem, we have a spending problem.

[@murraypassarieu9115]

@@FreakyLynx we have both; Republicans have convinced Americans they can have it all and for free. We were never this indebted (aside from WWII) until Reagan started cutting taxes and it's been a race to the bottom ever since.

[@bryanwhitton1784]

@@murraypassarieu9115 Preach it brother. Can I get an Amen?

[@MrSteeDoo]

@@FreakyLynx I guess you would prefer a recession and many fewer jobs?

[@SpookyEng1]

@@murraypassarieu9115And the Democrats never saw a social program they didn’t want to throw billions at. Plenty of blame to go around.

[@ThailandRob]

Love the outtakes :

[@kwong9153]

This is a simple actuarial problem. If you want to eliminate taxes on benefits, you must do a combination of lower benefits, delayed retirement age or higher taxes on working people. We live much longer and draw more benefits than when the program was created in 1935.

[@SandfordSmythe]

Both will annoy voters

[@oliphauntsneverlie6227]

The problem is the gov't stole the funds. That's it. Period.

[@kevinhenchy2957]

@@SandfordSmythe Having your benefit cut by 25% , which Erin stated as the likely outcome if no corrective action is taken, will surely annoy voters too.

[@toms5212]

The federal government isn’t using the tax money raised by taxing social security for the fund anyway. Like with everything, Congress is wasting that money elsewhere.

[@todddunn945]

Not true. Taxes on social security go to the trust fund. Read the 2024 social security trustees report.

[@toms5212]

@ thanks for pointing it out. Nevertheless. Money is fungible. It’s never a revenue problem. Always a spending problem. Personally, I wish I could’ve kept all my social security taxes and invested them myself. I’d be better off. I’ll be lucky to receive a portion of the benefits being currently paid out when I retire.

[@stevepaul2262]

@@todddunn945 Please show me the "lock box"

[@byronbuck1762]

@@toms5212 Simply not true. All federal taxes on social security are credited to the Social Security Trust Fund

[@aolvaar8792]

@@toms5212 my social security taxes and invested them myself. Who pays for the MILLIONS of poor SSA retirees, who get a share greater than their contributions?

[@ndguam]

None of our social security should be taxed, and we (65 and up) should be getting our Medicare Part B for free.

[@mhowardsterling]

love your outtakes

[@penelope5500]

Thanks Erin, the SS discussions (by knowledgeable people) are always fascinating. I took Trump's talk about discontinuing taxes on SS as just another empty promise by someone who wanted to win the election. The thing I always think about SS is that it's a wonder that single people are demonstrating in the streets re. the unfairness of SS to them.

[@rst90274]

Are you referring to the unearned benefits that spouses receive? Or that they benefits can be provided to a succession of ex-spouses who never contributed to social security as well as minor or disabled dependents?

[@penelope5500]

@@rst90274 Yes, all of that. I'd have to wonder why a woman (usually a woman) who never worked can draw half of her husband's hefty SS just b/c she has a marriage license when a single woman could work her entire life & maybe draw the same amt.

[@penelope5500]

Yes, all of that. The married spousal benefits kind of stick in my craw. Why should a woman (usually a woman) be elig. to receive half of her husband's hefty SS ck. just b/c she has a marriage lic.? Some of these women are probably getting more SS than the single woman who worked all her life. Wouldn't hurt my feelings if they did away w/ that.

[@rst90274]

@@penelope5500 I believe that provision in the law dates back to a time when men where the primary bread winner. If there was no benefit for the wife, if by death or divorce, the wife was likely left with nothing. Perhaps it is time to update it because people have figured out how to exploit it.

[@SpookyEng1]

@@penelope5500I’m married and I agree it should be eliminated. Funny how everyone wants equality when they only get the benefits and not the burdens (I.e. the draft).

[@kenotube3160]

I’m in the camp that believes there should be no salary cap for which wages are taxed for social security, even though I personally benefit from that cap. High wage earners like myself can easily afford to pay more into social security, and that one modification alone would go a long ways to keeping the social security trust fund solvent.

[@stevet2411]

AGREED! Let those of us who can afford it pay more. A more progressive tax system is the answer, and that would include SS benefits as part of the equation.

[@johnr8252]

Agree Ken. The current system has no floor, but a cap on income that is taxed for SS. I've always thought we should flip it and have a modest floor ($40,000/yr??) that don't pay, but an unlimited cap. And ALL income sources should be included, not just wages.

[@MrJRRTX]

AMEN! You are exactly correct!

[@bobstrayer9004]

We could lower the deduction % if we eliminated the salary cap.

[@Medmann48]

They don't need to make Social Security tax free, they just need to raise the threshold for it to be tax free.

[@jasonguy5702]

Great video! Very informative, thank you Ma’am!

[@andrewdiamond2697]

Good News: No tax on Social Security Income Bad News: No Social Security Income Seriously, the real problem is discouraging seniors out of the workforce when employment is tight and employers are looking for additional workers while seniors are still willing to work.

[@craigschray4486]

So SS is funded by Social Security tax? Please tell me more!

[@daveschmarder-US1950]

@@craigschray4486 Yes. The money that is paid because of this tax on SS goes in the SS trust fund. I've verified this. The IRS has a computer or two so they can do this. A quick Google search confirmed this. Not that my feelings count for anything, the fact that the extra tax paid does flow back to the SS coffer makes me a lot happier. Maybe Erin could research this herself and do a video on her channel about this misunderstood or not understood topic.

[@andrewdiamond2697]

@@craigschray4486 This video is about income tax on Social Security income. Maybe you missed that detail, which happens to be what the entire video is about.

[@bryanwhitton1784]

@@craigschray4486 Exactly! This income tax is not earmarked for the SS trust fund. It simply goes into the general fund as far as I know.

[@pastramionrye247]

You're right about the last part (even though it's a separate topic). And that's tied in to the insanity of still having our health care provided by our employer. Of course they want to push seniors out of the workforce in that system. We're starting to reach the point where the chickens are coming home to roost over Americans' unwillingness to tackle its problems head-on. We've fought at each other's throats for three decades now when we should have been working together, and we're unfortunately going to live the consequences of that failure.

[@joelplatt2651]

Nothing like cutting taxes on social security just in time for the wealthiest generation in the history of the world to hit retirement age

[@rst90274]

This was just another Trump campaign lie to get votes. Its never going to happen.

[@SpookyEng1]

The vast majority of boomers are well into retirement….

[@bobmcgehee1749]

Taxes on tax is theft.

[@joelplatt2651]

@ you understand that boomers are the wealthiest generation because of the political and economic system they were born into and not because they worked harder than everyone else right? You’ve clearly taken the most charitable explanation for your own life and the least charitable for others. Classy.

[@bobmcgehee1749]

@@roadking9680 100%

[@captaindaedalus1]

You said that you don't have easy answers, but you pretty much provided the answers I need. Fairness is at the heart of my answer. People struggling to have a decent life shouldn't be required to pay taxes. That burden should be on the shoulders of those who are better able to handle it. However, it's also unfair to tax a person again for reclaiming money the government acquired by taxation previously. If this double taxation is intended to ensure the solvency of the Social Security Trust Fund, then the U.S. government should return the $2.7 trillion it borrowed from that fund and currently owes, and stop the double taxation.

[@rubengonzalez8399]

The burden should be on those better able to handle it? If this was the way the system worked then people would be discouraged from doing better knowing they would be carrying the burden for people not wanting to work as hard as themselves. So you see your thinking on does not make perfect sense. Unless you are the lazy one benefiting from it. As far as double taxation, I think it is criminal.

[@captaindaedalus1]

@@rubengonzalez8399 So, let me ask you, has the possibility of paying a higher tax rate for having earned more income convinced you to work less hard? No? In real life, having a more comfortable life is all the encouragement needed by almost everybody to earn that higher income that puts them in that higher tax bracket. Do you actually believe that lazy people are "benefiting" from a lower tax rate? Is their life so good? I've seen plenty of people, as I'm sure you have, that work very hard at two and even three jobs trying to put food on the table and pay their utility bills while hoping nobody in their family gets sick. Is that what you mean by being lazy? They are not earning less because they are lazy. Often they never had the money in the first place to get the educational credentials to get the better job. Circumstances often conspire against people. Or, they simply don't have the talent to get that better job. I encourage you to be less cynical. Your attitude and well being will improve when you no longer view life as "us against them." You and I can make this world better.

[@rubengonzalez8399]

@ the lazy people I’m referring to are the ones that can do better but don’t, they have the opportunity to work more hours and prioritize their money on needs versus wants, ie. tattoos, electronic devices, vapes, nice rims for their cars, nice jewelry, gold teeth, you get the picture. If you want more then go work for it. Use the money wisely for life and health insurance, light bill, food, clothing, you know, necessities. So many times when people have tragedies illnesses, accidents, deaths, people turn to gofund accounts, food benefits and other sorts of fundraisers which would rely on other people’s donations to help their situation. I would love to not have to spend money on insurance, health, life, home, auto and instead buy the latest iPhone, get tattoos gold teeth, take vacations, but instead I sacrifice these things and prioritize what is necessary. I don’t make a whole lot of money. If I want something I work extra or sacrifice going out to eat, making my lunch instead of buying lunch there are all sorts of ways to get what you want other than relying on their people funding your wants. And guess what, if I can’t make it happen, I don’t need it. I realize there are other people the ones that you described that are in situations that don’t make it possible for them to support themselves. These are not the (lazy) people I am talking about. And yes I agree, you and I together can help make this world better. Merry Christmas

[@teofilstevenson]

Thanks for leaving in the outtakes…very funny.

[@BrianW211]

What's sad is that even if you were never a high earner, but you made sacrifices your whole life to be a diligent saver, you will still get penalized during your retirement.

[@MrSteeDoo]

Find another country if you don't like this one.

[@BrianW211]

@@MrSteeDoo I hope you misread my comment, or do you really think it's fair for an elderly person just trying to maintain a lower-class income in 2024 to have their Social Security taxed to further reduce their lower-class income?

[@MrSteeDoo]

@@BrianW211 The "lower-class income" people you mention are barely affected by the tax.

[@BrianW211]

@@MrSteeDoo What does "barely affected mean to you." Lower income class (single, not couple) is $52K and below in 2024. So if a retiree withdraws $34K from a tax-deferred IRA, and their social security is $18K/year, they they will still be considered lower-income, but have to pay $1500/year in taxes on their social security benefits in addition to the $2000 in taxes they pay on the IRA withdrawal.

[@MrSteeDoo]

@@BrianW211 OK so they can take out an additional $2000 from their IRA if they are hurting. Someone taking out $34K a year from their IRA has a much larger IRA than average. Say around $850K

[@billstapleton1084]

What Trump needs to do is get Congress to properly index the earnings. If adjusted to match inflation it would go from $44,oooo to $103,000. That would be the honest and fair way to fix this problem.

[@Satjr35031]

Then Ss would run out of paying full benefits by 2030

[@billstapleton1084]

@@Satjr35031 Not if our government would pay back the money, they took from the lockbox. SS is holding $1.4 trillion dollars in IOU from the Government

[@davidodell4687]

Trump doesn't give a shit about you duuu

[@billstapleton1084]

@@davidodell4687 It is not about me. It is about America. He does care about the country.

[@davidodell4687]

@billstapleton1084 Really? I seriously doubt that get your head out of your a** Really? better yet get your head out of his a**

[@chiaroscuro6655]

The tax on social security is a problem with this system. Another problem I never hear people worry about is this; If we saved our own money for our retirement rather than letting the government handle it, then when we die the remainder of our funds would go to our heirs. Before the social security system was invented that's what happened. But with social security the generational wealth disappears. "Generational wealth is intended to provide future generations with a financial head start and the ability to build upon their predecessors' financial foundation."

[@Growing-Our-Retirement]

Excellent point. This is intentional as the government has no real interest in seeing people or families becoming financially independent. Unless they can tax it.

[@rgarri6396]

If you saved on your own then a few dollars of social security means nothing. Did you save millions?

[@Growing-Our-Retirement]

@@rgarri6396you bet I did. Watching what the government has done over my lifetime to SS the choice was clear. Don’t count on the government.

[@byronbuck1762]

@@chiaroscuro6655 Nonsense. Nothing is stopping you from saving beyond Social Security. And Social Security is an INSURANCE program. And like term life insurance, the lucky people never collect

[@robertrohler3644]

Good videos and very informative. Thank you for taking the time to educate us on financial matters. Keep up the good work. Cheers!

[@BengoBango]

More importantly I think the Social Security tax limit should be phased out to ensure the wealthy continue to pay into this necessary system. I think Social Security should still be taxed, but I agree that the income ranges need to be adjusted to meet inflation.

[@shawnbrennan7526]

Fine, but you do recognize that then you have to increase the maximum payout too, right?

[@GAFB1122]

​@shawnbrennan7526 NO, you don't have to. I don't cry for wealthier people when they scream that the tax system is unfair to them.

[@shawnbrennan7526]

⁠@@GAFB1122 Wealthy people don’t scream when they think the tax system is unfair. They just hire sleezeball tax attorneys and buy a few politicians.

[@todddunn945]

@@shawnbrennan7526 All it takes is a new bend point in the benefit calculation to make the increase small.

[@byronbuck1762]

Eliminating the tax would be yet another tax break for the more affluent as fifty percent don’t pay it given low income. Where are you going to raise taxes to replace the income?

[@agpablo2885]

Given that the threshold for paying taxes on SS benefits is $25,000 for singles, are you implying that people making $26,000 are affluent? If so, I most vehemently disagree with you.

[@byronbuck1762]

@ no, they are just more affluent than the 50% who aren’t yet paying because their income is even less. Given our tax system is progressive truly affluent people making more than $200,000 a year will reap the biggest benefits

[@MrSteeDoo]

@@agpablo2885 That person making 26K would end up paying about $50 in taxes.

[@aolvaar8792]

@@agpablo2885 NO, Provisional income is 50% of SSA income, added to income>> $50K X 50%= $25K The threshold is $50K, if all you get is SSA.

[@todddunn945]

@@MrSteeDoo Nope. You have to remember that that $25K threshold is based on all non social security income plus HALF of social security. Then after you determine how much social security is subject to tax, you add it to other taxable income and subtract the standard deduction. Remember taxable doesn't always mean taxed. How much tax would be due depends on the relative amounts of social security and non social security income. Your $50 tax is the maximum tax that would be paid on social security. If the person making $26K had less than about $16K in non social security income no tax would be due.

[@JasonBraswelljrb]

Step 1: Eliminate the tax on benefits Step 2: Ban Congress from raiding the SS fund Step 3: allow people to choose how their SS contribution is invested

[@byronbuck1762]

All bad ideas. #1 hastens the day Social Security runs out of money to pay full benefits. 2. Congress never raided a dime. They only borrowed surpluses which are being paid back. 3. Tax revenues go right back out to pay benefits. There’s nothing to invest. You have little knowledge about how SS actually works

[@marengoczar5035]

For 2, I think the issue is that we've cut taxes in the good times and reckless borrowed against SS. 3. Issue is that your retirement will sit at Blackrock, and they'll just leverage our money to buy single family houses and such. The stock market is worse as it would distort the stock market, so the average stock will have 50 P/E ratio.

[@JasonBraswelljrb]

@marengoczar5035 sadly Blackrock is more ethical than Congress. But I digress... No they don't need control of the contributions. There are thousands of options other than Blackrock.

[@michaellammert8084]

Make Congress participate in Social Security and see how quickly they fix the problem!!!

[@byronbuck1762]

@ They have been paying in since January of 1984

[@spaceinvadertoo]

Love your bloopers.

[@danielrussell9416]

I'm retired and have never paid any income tax on my SS benefits. While you are working you want to design your regular and retirement savings as to minimize the income taxes you pay in retirement. Remember, the higher your income is in retirement, the more you pay for Medicare. Plan well.

[@greggpurviance7252]

The higher your income the better off you are, financially. Higher taxes & Medicare really aren't factors. Yes have big Roth accounts, but if you have taxable accounts, you are just kicking the tax down road to your kids (heirs) or your future self

[@Singlesix6]

No thanks, we will take as much income as we can get. If we end up in the highest brackets - GREAT

[@Dave-sw2dm]

​@@greggpurviance7252 it is too complicated to just provide a simple statement. Everyone has a different situation. Example, if a person's income bridged the current 12% and 22% tax brackets they would be paying 22% on the money they put into a Roth but zero now on money they put into a traditional. When they retire and are able to stay in the 12% bracket they can do Roth conversions to the max of the 12% and save 10% off the top. Then they have Roth money for later.

[@stevepaul2262]

Remember, the higher your income is in retirement, the more you pay for Medicare. " Great advice!

[@pbtube58]

It is complicated, but in general, the best strategy is to be in the same tax brackets your whole life, as much as possible. Yes, with the correction for not paying extra for the Medicare. Also, you need to think about the effective marginal tax rate. For example, if you are in 12% bracket and a significant portion of your SS is taxed, you might effectively pay at 12%*1.85 = 22.2% marginal tax rate.

[@kirklandphil]

Great video, Erin. I have always considered SS a good way to ensure that people who struggle to save will have an income in retirement. I worry that Billionaires and corporations would like to rework it to make themselves richer. Yes, I think they should continue the tax but anyone who shows they only make SS should not pay on it. Many of us get income from investments, 401k's, pensions, and 4% of our saved money, we should be paying the tax on SS income. Fair I don't care, it's just right.

[@kirklandphil]

BTW 100k is just around the corner!

[@Jonas-ue6ep]

So basically reward those who made terrible financial decisions throughout their life, and penalize those who saved, invested and managed their money wisely?!? Got it!!

[@TheFirstRealChewy]

That's how things work today. If you have little taxable income, then you pay little to no taxes on your social security benefits. Having other taxable income forces more of your benefits to be taxed. I starts with a calculation of 50%, then goes up to 85%. Soon that will likely be 100%. The bad part is that a little income can quickly cause 50-85% of your benefits to be taxed. So if you're saving any amount of money to a tax deferred account you are almost guaranteed to have 50% or more of your benefits be taxed unless you withdraw very small amounts each year.

[@av8rgrip]

@@kirklandphil how is it right that those who planned ahead and made sacrifices to save for retirement have to pay more than those who blew all their money on expensive homes and cars?

[@dallison1961]

@@av8rgrip That's how a progressive tax system works. That is what we have in the United States. The more income you have, the more you will pay in taxes.

[@camc8923]

Taxing an income that is taken from you via a tax is just wrong. Honestly I'd rather not pay SS and invest it myself.

[@av8rgrip]

@@camc8923 THIS RIGHT HERE!

[@silver6054]

Is that VERY different (I agree it is somewhat different!) from: I buy a stock with my after tax income. It goes up a lot and I sell. Why should I pay capital gains, I had already paid tax on the money used to buy the stock?

[@abark]

@@silver6054 if you took a second to understand why long term capital gains are taxed at a different rate than ordinary income, then you wouldn't need to ask that question. Besides, the answer is you are correct you shouldn't have to pay capital gains at all because it's already been taxed.

[@silver6054]

@@abark Did I say anything about long-term capital gains, could be short-term taxed just like ordinary income. But that seems beside the point, as your view is income is taxed just once, and anything gained from it (capital gains, interest/dividend, SS) should be tax-free. Which I guess is at least consistent. And I guess the analogy can be stretched to property tax and sales tax (in both cases buying things with already taxed money)

[@abark]

@@silver6054 none of it should be taxed at all. Certainly not twice.

[@robgrey6183]

My mother grew up during the Depression. She trained as a nurse. She joined the Army medical corps, and spent the winter of 43-44 in a casualty clearing station in northern Italy within range of German artillery. In 1984 they started taxing her social security benefits. She never overcame the sense of betrayal she felt towards the Government she served.

[@hohner51]

I stopped listening when you called it an entitlement. We paid in to Social Security for years. It is OURS. It is NOT an entitlement.

[@TomStarcevich-fb3qo]

Exactly 💯 💯 💯 💯 💯

[@loubow7104]

We are absolutely entitled to it we paid in to it, what they need to stop calling entitlements are welfare and social security disability you are not entitled to those kinds of things by virtue of being!

[@hohner51]

@@loubow7104 it has to do with legal definitions and the legal status of the program. Calling it an entitlement puts it in the same category as welfare. And they seem to be doing it on purpose. btw., they need to return the funds that were wrongfully taken out of the program and used elsewhere..

[@loubow7104]

@ absolutely!

[@user-vu8iu2sx5u]

@@hohner51 A subsidy is welfare but an entitlement that someone paid into, is not. How can someone at SS age, not know this???

[@Jaykp123aol]

I don’t think SS should be taxed at all !!!

[@Satjr35031]

It’s not taxed if that’s your only income Regardless of how much you receive.

[@HelenGrant-o8b]

I always look up your videos for updates! Our government has no idea how people are suffering these days. I feel for people with disabilities not getting the help they deserve. Thank you, Caroline Suzan Olson My financial advisor can't imagine investing $3000 and receiving $7,300 from her.

[@JosephZerafa-l3g]

I'm surprised that this name is being mentioned here; I stumbled upon one of her clients testimonies on CNBC News last week.

[@JoyceStanley-m3e]

Caroline Suzan Olson strategy has normalised winning trades for me also. and it's a huge milestone for me looking back to how it all started.

[@JoyceStanley-m3e]

Simply search her name in your browser and check whether she meets your requirements. You'd find all of the information you need about her.

[@LoïcJansen]

I learn a lot from "Caroline Suzan Olson, she's a big name in her field with more than 20 years of experience. You should look her up online for more info.

[@BrianW211]

I'm tired of seeing these spam-bot shills for Caroline Susan Olson every day. She isn't even a real person. Just a fake name for a network of scammers.

[@YolandaGomez-o7n]

Hi Erin, Love your segment on the no tax on SS. I am a retired Police Officer (City of San Antonio, TX) who also paid into SS, but being a retired Police Officer, my SS that I earned, takes a 66 percent hit from the Federal Government. The Social Security Fairness Act is on its way the Senate. Hopefully if this gets passed Police Officers, Firemen, and Teachers will get the full Social Security benefits that we earned. Thanks Mike Gomez.

[@marklopez4762]

Ssi how much i paid into it has been insane. it's such a bad investment if you invested those funds on your own. Yes tax free to help those who don't plan.

[@andrewdiamond2697]

Between me and my employer, I have well over $300k paid in. If that went into a 401k, at an average of $10k a year from 1987 to present, with growth, that would be over a $1 million.

[@craigschray4486]

EXACTLY!! It's nothing more than a slush fund for the government

[@byronbuck1762]

It is a social insurance system and you can’t compare it to a private investment fund. You and your dependents were protected with disability insurance and death benefits. A private investment fund has no such benefits

[@globalfamily8172]

@@byronbuck1762 If you have no dependents, why should you be forced to participate?

[@byronbuck1762]

@ It’s a social compact. It only works with everyone in the pool.

[@danschwartz1950]

Thank You President Trump. Promises made. Promises kept.

[@MikeM.nomiles]

Lol, just like no tax on tip, overtime,...... already said prices wont be going down.

[@user-vu8iu2sx5u]

@@MikeM.nomiles Trump Regret is a thing, now.

[@MikeM.nomiles]

@@user-vu8iu2sx5u yup and i will be laughing sadly

[@MikeM.nomiles]

@@user-vu8iu2sx5u yup all the bacon lovers will be pissed

[@LVclubbouncer]

My opinion is : there should be No Federal tax on Senior Citizens collecting Social Security because it is Unfair to Senior Citizens trying to live during their retirement years . Thank you President Elect Trump 2024 !! 🇺🇸

[@Satjr35031]

There is no tax on SS if that’s your only income, even if you receive $50,000 a year. Trump is clueless on how taxation works on SS

[@mnkpatrick]

I enjoyed your video. Thank you for the information. While I understand the need for taxes, I despise any double and triple taxing of my hard earned money.

[@todddunn945]

As a retiree whose social security benefits are 85% taxable I would not mind if the tax went away, but I have to balance that against the fact that those taxes go back into the social security system, and help to extend the life of the trust fund. So I am kind of "meh" about eliminating taxation of social security benefits.

[@clintonbubb3187]

Except for the fact that those taxes do NOT go back specifically to SS, but rather to the US Treasury, which spends it as it sees fit. One can argue that you'd be better off just setting the money on fire.

[@todddunn945]

@@clintonbubb3187 Educate yourself. Read the 2024 Social Security Trustees report. You will see that income taxes paid on social security benefits are transferred to the Social Security system and are used to pay benefits.

[@craigschray4486]

I know my statement is political, but it shouldn't be. Seniors have paid taxes their entire lives. They shouldn't be paying taxes on SS benefits. We need to take care of ourselves and stop sending $$ to foreign countries. How many billion have we sent to Ukraine.

[@johnnyretires]

Mmmmm. We are not sending SS funds to foreign countries, Elmer Fudd

[@Androctonus84]

How much have we "sent" to Ukraine? Not anywhere near as much as you think. Not even remotely close, likely. Those dollar figures you see do not represent actual money being given away or spent. They represent the original value of equipment that we're sending. But that equipment was already paid for years, in most cases decades, ago. So it isn't actually money we're spending on Ukraine. The vast majority of that equipment is also at or nearing the end of it's shelf life and would have been replaced anyway, at exactly the same cost whether we sent it to Ukraine or not, making the actual cost a net zero. In many cases sending it to Ukraine is even cheaper for us that simply disposing of it, or continuing to store it in mothballs before we eventually dispose of it, as we normally would have otherwise, because the demilling costs can be quite expensive in some cases, meaning that we often actually save money by sending it to Ukraine to be used up rather than paying to dispose of it safely or store it in a boneyard for years and years until we do. It's like cleaning out your garage and giving away all the stuff you are never going to use and are eventually going to throw out anyway, and then reporting the amount you paid for it all when you first bought it as "value", when in fact they're doing us a favor in taking it off our hands. It's like donating last year's hurricane supplies to a food bank to be eaten when you replace them, rather than just throwing them away. It doesn't actually cost you anything, but it still has a "value" that can be reported even if it has no actual value to you any longer. By sending them our old equipment that we need to dispose of anyway, we free up funds wasted in storing and maintaining it that can instead be used to modernize our own military. It's a win economically and militarily for us. You see the same in Europe, where NATO countries are sending their outdated Cold War equipment and buying new things to replace it, like buying F-35s from us to replace their 30 year old F-16s, Or new M1 Abrams to replace their Soviet tanks, putting money and jobs INTO the US economy. Anyone who has convinced you that it's taking money out of your pocket is lying to you.

[@JBoy340a]

Most of what we send to Ukraine is old weapon systems like F-16s, HIMARS, and Bradley fighting vehicles. These have or soon will be phased out of use by US troops and lots of NATO. Getting rid of them gets them off the books, reduces the expendetures to store them in near fighting conditions, and frees funding for newer systems.

[@craigschray4486]

​@johnnyretires actually we've sent about $175 billion to Ukraine. Now imagine putting half of that to towards SS? Pretty novel thought eh...? Like I said, it's political. I didn't point any fingers... I just pointed out facts.

[@craigschray4486]

​@@JBoy340awe've sent about $175 total and no, it's not all just relic military weapons. We just sent several missiles to them. About half of what we sent is $$. Stop being so defensive. I said my original statement was political. That's why I didn't point finger's... I just stated a fact. Everyone knows we shouldn't be over there. It's time to help ourselves. If you can't handle that, then move on!

[@dollaranatomy]

That was good information. Let’s see if anything change

[@drwisdom1]

Miss Erin really provided a comprehensive discussion on the aspects of taxing SS benefits.

[@baileyroy69]

I've payed into the system for forty-five years and that's more than enough. We have always paid our way.

[@garymartin9665]

You speak very clearly and very wonderful I appreciate the time you put into this sometimes you're a little over my head but I'm old, have you ever talked about how much money was taken out of social security by the government that should have never happened

[@tjveach]

Great job young lady !

[@ReasonablySane]

I retired three years ago. My wife has not worked outside the home for quite a while. We pay no income tax. The reason: we have two very tiny pensions and SS as income, and that's ALL. My retirement plan was not to have a lot of savings, but to have a lot of stuff and ZERO debt - and live in a place where property taxes are low. And here we are. We live on 32 acres of woods and lawns. We have four cars, a nice "smaller" house, a beautiful shop/mancave and property taxes of the price of a loaded medium pizza every month. Our monthly cost of living is about half of our SS payments. i.e. yes, we still save. Though most of it goes to buying major items we need. i.e. water heater,