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Social Security tax planning

Social Security tax torpedo calculator

The tax torpedo happens when extra income causes more Social Security benefits to become taxable. This quick estimator shows the provisional income thresholds.

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Before you decide

  • Use annual benefits, not monthly benefits.
  • Include taxable income such as wages, pensions, IRA withdrawals, and interest.
  • Add tax-exempt interest because it counts in provisional income.

Tax torpedo quick estimator

Current provisional income

$43,000

Provisional income after extra income

$48,000

Current taxable benefit

$12,150

Taxable benefit after extra income

$16,400

Incremental taxable benefit

$4,250

Room to next threshold

Top range

IRS simplified provisional income thresholds for your filing status: $25,000 (up to 50% taxable) and $34,000 (up to 85% taxable).

What the estimate means

Provisional income

The simplified formula is other income plus tax-exempt interest plus one-half of Social Security benefits.

Taxable benefit is capped

Depending on provisional income, up to 50% or up to 85% of benefits may be taxable.

This is not total tax

The estimator shows taxable benefits, not your final federal income tax bill.

Official sources