Are Social Security benefits taxable? How the combined income formula works in 2025
Yes, Social Security benefits can be partially taxable — but whether they are taxed depends on your combined income, not just your SS benefit amount.
The Combined Income Formula:
Combined Income = Adjusted Gross Income (AGI) + Nontaxable Interest + 50% of your Social Security benefits
This is the number the IRS uses to determine how much of your benefit is taxable.
Thresholds for Single Filers (2025):
| Combined Income | Taxable portion of SS benefit |
|---|---|
| Below $25,000 | 0% — no SS income taxable |
| $25,000 – $34,000 | Up to 50% may be taxable |
| Above $34,000 | Up to 85% may be taxable |
Thresholds for Married Filing Jointly (2025):
| Combined Income | Taxable portion of SS benefit |
|---|---|
| Below $32,000 | 0% — no SS income taxable |
| $32,000 – $44,000 | Up to 50% may be taxable |
| Above $44,000 | Up to 85% may be taxable |
Important clarification: "Up to 85% taxable" does not mean you pay 85% tax. It means up to 85% of your benefit is included in taxable income — then taxed at your ordinary income rate (which may be 10%, 12%, 22%, etc.).
These thresholds have not been adjusted for inflation since 1993. This means that as average SS benefits and other retirement income have risen with inflation, more and more retirees have been pushed into the taxable zone even though their real purchasing power has not increased.
OBBBA note (2025): The One Big Beautiful Bill Act signed in July 2025 did not eliminate the taxation of Social Security benefits. Despite campaign promises, this provision was not included in the final law. Benefits remain taxable under the same combined income formula.
How to reduce taxes on Social Security:
- Reduce other income in early retirement years — delay withdrawals from traditional IRAs to keep combined income below the $25,000/$32,000 floor
- Roth conversions before claiming SS — Roth withdrawals do not count toward combined income
- Qualified Opportunity Zone investments — can reduce AGI in certain cases
- Delay claiming SS — higher future benefit but does not directly reduce the taxable percentage
- Municipal bond interest — technically nontaxable interest, but it is added back into the combined income formula, so it can increase the taxable portion of SS
Use IRS Publication 915 Worksheet 1 or the Social Security Benefits Worksheet in your Form 1040 instructions to calculate your exact taxable amount.
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