strategies-to-reduce-taxes-on-social-security: Personal Finance News from Yahoo! Finance

strategies-to-reduce-taxes-on-social-security: Personal Finance News from Yahoo! Finance: "Strategies to Reduce Taxes on Social Security
Sponsored by by Rachel L. Sheedy
Wednesday, September 1, 2010

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EmailPrintYou worked hard all your life, paying into the Social Security system. Now you're ready for payback time. Not so fast. Uncle Sam may want a piece of your benefits. Up to 85% of Social Security benefits may be subject to federal tax, but tax planning can help ease the pain.
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The tax hit will depend on your income and marital status. First figure your modified adjusted gross income, which includes non-Social Security sources of taxable income, such as pensions, wages, interest and dividends. Add in tax-exempt interest and certain other exclusions from income. Itemized deductions won't help you in this calculation, says Robert Seltzer, a certified public accountant in Beverly Hills, Cal.
Next add one-half of the Social Security benefits you receive for the year — the total is your 'provisional income.' Then look at the IRS's 'base amounts' for taxing Social Security. The base amounts are $32,000 for married couples filing jointly and $25,000 for single filers."

In the previous blog I discussed how if the focus of the nation was towards taxing and raising revenue for the United States instead of censoring the country would not be in a recession. However, this idea of taxing social security has taken it a little to far. Social Security income has already been taken from you as a trade off for an exchange of a benefit at a later date for using your services (income) now. At what point will the U.S. government censor how far they are allowed to execute any law?