I am on Social Security. Please tell me how much I can withdraw from my IRAs (not Roth) before I have to pay tax on it?
Answers | 2
Whenever you withdraw funds from pre taxed accounts ie. Traditional IRA, 401(k), 457(b), or 403(b) you have to pay taxes. Your tax rate depends on your taxable income for the year. If you would like to discuss a withdrawal strategy email me for a time to meet.
If half (1/2) of the Social Security benefits you received in the last year added (+) to the amount of income you received from other sources is higher than the allowed 'base' determined by the IRS (which is $25,000 for single filers and $32,000 for married filers for up to 50% of benefits to be taxed and then $34,000 for single filers and over $44,000 for married filers for up to 85% of your benefits to be taxed), then your Social Security income may be taxed - this according to IRS Publication 915. It's very important to get this figured out by a CPA or Accountant so that you have real numbers to work with.
The silver lining, though, is that there are ways to move assets around so that your taxable base is much smaller and may prevent your Social Security benefits from being taxable all together. I'd be happy to speak with you personally regarding your unique situation to see what may be possible.