New client - retired - wife passed away in 2014. Closed out many pensions and IRAs to cover medical expenses, yet owes IRS $18,000.
Total pension/IRA distributions for the year were $92,000. Rental income (after expenses) $9,775. SSA (combined) just under $18,000.
Total income was about $120,000. Not enough deductions to itemize, so standard deduction is taken. $14,000 of SSA benefits are taxable. Total tax owed to the IRS is just under $18,000.
Why are the SSA benefits taxable? Both taxpayers are in mid-70s.
Tax Professional Answers
Meet Leading Tax Advisors
Federal Tax Credits & Incentives Practice Leader
New York, NY
CEO/Certified Financial Advisor
Rancho Santa Fe, CA
San Jose, CA
Long Beach/ Park City, CA