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New York Taxability of Social Security Benefits

On Behalf of | Jan 8, 2017 | Social Security Disability (SSD)

Most person currently receiving social security benefits are already aware that they are responsible for paying some federal income tax on their received benefits every year if their annual combined income is above $25,000. No one is required to pay tax on more than 85% of their total received social security benefits for the year, but that tax still has to be paid. The good news is that if you are a New York state resident who receives benefits from social security disability insurance compensation or secure supplemental income, you are exempt from paying state and local taxes on all of your social security benefits income.

This does not mean that you owe no state or local tax on any other income you receive, as that will still need to be paid either via payroll deductions, quarterly payments, or annual payments. However, in the course of calculating and completing your tax returns, it is possible to make mistakes in the calculation of how much tax you owe on your social security benefits.

Furthermore, if you include income that need not be included on your federal tax return as a recipient of SSD or SSI, the SSA may actually reduce your monthly payment amounts based on your total combined income. Contesting reductions in payout can be a difficult, lengthy, and sometimes expensive process.

Additionally, you are also facing the prospect of navigating the SSA’s bureaucracy again similar to when you filed your initial disability claim. In short, your payment can be reduced based on your income despite not owing any taxes to the state or federal government, and you must wait months for your appeal of the change in benefits calculation to be accepted, processed, and then restored.

What are you supposed to do in the interim now that your monthly income (which you need to pay your bills and survive) has been reduced? How are you supposed to get by until the mistake has been fixed?

If you are a New York Resident who has found themselves having their benefits reduced after filing your tax return, you need to contact the New York Disability Attorney Daniel Berger for help. He and his highly trained staff can help you file the appropriate claims and appeals you need to get your payments restored to their proper level if an error has been made. Call today for a case evaluation.