The Social Security benefits a taxpayer received in 2010 may be taxable. A taxpayer should receive a Form SSA1099 which will show the total amount of his or her benefits. The information provided on this statement along with the following facts will help a taxpayer determine whether or not his or her benefits are taxable.

1. The amount—if any—of a taxpayer’s Social Security benefits that are taxable depends on the taxpayer’s total income and marital status.
2. Generally, if Social Security benefits were a taxpayer’s only income for 2010, the taxpayer’s benefits are not taxable and he or she probably does not need to file a federal income tax return.
3. If a taxpayer received income from other sources, the taxpayer’s benefits will not be taxed unless his or her modified adjusted gross income is more than the base amount for the taxpayer’s filing status.
4. A taxpayer’s taxable benefits and modified adjusted gross income are figured on a worksheet in the Form 1040A or Form 1040 Instruction booklet.
5. A taxpayer can do the following quick computation to determine whether some of his or her benefits may be taxable:
   • First, add one-half of the total Social Security benefits the taxpayer received to all the taxpayer’s other income, including any tax exempt interest and other exclusions from income.
   • Then, compare this total to the base amount for the taxpayer’s filing status. If the total is more than the taxpayer’s base amount, some of the taxpayer’s benefits may be taxable.
6. The 2010 base amounts are:
   • $32,000 for married couples filing jointly.
   • $25,000 for single, head of household, qualifying widow/widower with a dependent child, or married individuals filing separately who did not live with their spouses at any time during the year.
   • $0 for married persons filing separately who lived together during the year.

For additional information on the taxability of Social Security benefits, consult your professional tax advisor or tax preparer, or see IRS Publication 915, Social Security and Equivalent Railroad Retirement Benefits. Publication 915 is available on the official IRS website at www.irs.gov or by calling 800-TAX-FORM (800-829-3676). Please also share this article with others that might benefit from this information.