Unformatted text preview: o Provisional income equals adjusted gross income, plus one-half of Social Security received, plus some non-taxable items such as tax exempt interest. o 1 st Threshold base amounts - $25,000 if Single, and $32,000 for MFJ o If over threshold there are two options 50% of Social Security benefits or 50% of the excess of the taxpayer’s provisional income over the base o 2 nd Threshold base amounts - $34,000 if single, and $ 44,000 for MFJ o if over threshold there are two options 85% of Social Security benefits or 85% of the amount that provisional income exceeds the threshold plus $4,500 for unmarried taxpayers or $6,000 for MFJ Specific Exclusions Applicable to Individuals Certain items are specifically excluded from an individual’s income include; o Gifts and Inheritances, Scholarships, Certain damages, Workers’ Compensation, Interest on Educational Savings Bonds, Proceeds from life insurance Deductions...
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- Fall '14
- Accounting, Taxation in the United States, social security benefits, provisional income