#8 Tax – 10 Things You Need To Know To Plan Your Retirement Income

 In Ozarks Live, Financial Planning

#8 Tax – 10 Things You Need To Know To Plan Your Retirement Income

Do you know how your income will be taxed once you retire? Social Security Income, pension, IRA distributions, or your savings? The United States income tax laws are among the most complicated in the world. Working with a trusted adviser could help you minimize your tax liability.  Social Security benefits are income-tax free for the majority of beneficiaries. However, if the combined income falls between established thresholds, a portion of the benefits may be taxed.

Based on Internal Revenue Service (IRS) rules:

If you file an individual federal tax return and combined income is:

  • Between $25,000 and $34,000, up to 50% of benefits may be taxable.
  • More than $34,000, up to 85% of benefits may be taxable.

If you file a joint return and the combined income is:

  • Between $32,000 and $44,000, up to 50% of benefits may be taxable.
  • More than $44,000, up to 85% of benefits may be taxable.

If you are married and file a separate tax return, you may pay taxes on your benefits.

A simple formula to figure out combined income is calculated by taking the adjusted gross income, which includes all taxable income, and adding in non-taxable income. An example of non-taxable income would be municipal bonds. Municipal bonds themselves are exempt from federal tax, but the income from municipal bonds are used in the determination of whether the Social Security is taxed or not. Life insurance policies do not count as part of the calculation for Social Security. It’s important to consider getting a life insurance policy while it can be done, with enough time to build up a large amount of cash value.


Investments which may not be counted in your total combine income include Roth IRA or cash value Life Insurance. You may wish to reconsider your current retirement income vehicles to potentially minimize your tax exposure. Always consult an expert and get a second opinion.

Tune into Bruce’s show on Tuesday for the next part of the 10 things you need to know to plan your retirement income series.




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We are an independent firm helping individuals create retirement strategies using a variety of insurance and investment products to custom suit their needs and objectives.  This material is intended to provide general information to help you understand basic financial planning strategies and should not be construed as financial advice.  All investments are subject to risk including the potential loss of principal.  No investment strategy can guarantee a profit or protect against loss in periods of declining values.  

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions.  

We are not permitted to offer, and no statement contained herein shall constitute, tax or legal advice.  Individuals are encouraged to consult with a qualified professional before making any decisions about their personal situation.  Our firm is not affiliated with the U. S. government or any governmental agency.  Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM).  AEWM and The Resource Center are not affiliated companies.  AW02181711


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