When Social Security first came on the scene it came with a promise. FDR is quoted as saying,

“Social Security will not be taxed…It is not intended as a tax resource.”

But what are politicians good at making but bad at keeping? That’s right, Promises!

And as far as political promises go this one lasted a really long time as Social Security was not taxed for many many years.

But all of that changed around 1983 when new laws were enacted in order to help maintain the solvency of the system.

Now before we go any further with this, how do you feel about your Social Security benefits being taxed?

Sure, I know you don’t like it but why is this tax so unfavorable, why does it leave a particularly bad taste in your mouth? Ahh, now you got it because it’s a tax on a tax, isn’t it?

The money to fund this benefit was already sucked out of our paycheck before we could spend it and when that happens what do we call that? A Tax.

Then when we go to collect it we have to pay tax on that same money.

If that’s not enough to have steam coming out of your ears then you are a lot nicer than I am. And unfortunately, it gets a little worse. Let’s look at how they figure out this tax.

                                        Married                   Single                Percent Taxed

           Over             $32,000                  $25,000                          50%

           Over             $44,000                  $34,000                          85%


So, if you are married and your provisional income is over $32,000 then about 50% of your Social Security benefits will be taxable.

If you are married and make over $44,000 then about 85% of your benefits will be taxable.

And it’s even worse if you are single.

Now as if that is not bad enough, let’s think about this for a minute.

Is $44,000 a lot of income in today’s economy?

I mean are we living high on the hog because we make $44,000 or more per year or are we just about getting by with $44,000?

Well, remember I said the tax laws changed back in 1983, that is when these limits were set.

Now back in 1983, $44,000 was a decent wage.

So, why do you think no one complained when they started taxing our benefits?

That’s right most people were not making that kind of income. But how about now? And the kicker is these limits were never designed to be adjusted for inflation.

Now, how do you feel about taxes on your Social Security? Fair or unfair? Was the government being sneaky or what?



The good news here is that due to provisions in the tax code not everyone needs to pay these taxes.

In fact, there are multiple ways that these taxes can be avoided and sometimes very painless.

Obviously, we would not want to lower our standard of living just to save a few dollars on taxes but sometimes the adjustments we make have little or nothing to do with our spending or enjoying our money.

And a lot of times these things are missed by our accountants and I bet you can imagine why.

Have you ever gone to an accountant’s office during tax time? I’m sure he is very polite and he pulls out a chair for you and offers to shoot the breeze while he makes you a cup of tea, right? No of course not, and why not?

It’s because he only gets paid so much per return and he or she has to get as many done as possible so they can earn a living.

So, do you think your accountant combs through every tax return and looks to see how close you are to the thresholds we just talked about, taking a break from filling out other returns just to make sure you have things invested in just the right way to take full advantage of the tax code or do they just rush through to get to the next one to help us all meet our deadline?

It’s no wonder that these little know tax breaks often get missed, and another reason is some of the strategies have not as much to do with the tax code as they do with what kind of investments you are using.

For just one example of many, did you know that most mutual funds buy and sell stocks very frequently causing you to pay ordinary income tax instead of the much lower capital gains rate?

And did you know sometimes saving money on taxes can be as simple as switching from mutual funds to ETF’s which work very much like mutual funds as far as the stocks that you own but are generally held more long term like an individual stock?

So, owning an ETF instead of a mutual fund likely won’t hurt your returns one bit but it can make a huge difference to how much tax you pay on your gains and how much tax you pay on Social Security.

Again, this is only one example there are literally hundreds of strategies to look at, how many are you missing? One way to find out is to have an analysis done by someone who looks at these kinds of things every day.

Want to learn more about how having a long-term tax advisor in addition to your short-term tax consultant can help you maximize Social Security, Medicare, and other retirement benefits so that you make certain you get everything right the first time and avoid making any mistakes?

Apply for a complimentary one-on-one strategy session with me today….

And I’ll show you how to do all of this – for FREE!

My job is to help you make educated decisions about your money that feel right to you.

That might include not changing anything or doing anything differently if that is what feels right.

My job is NOT to wrestle you into some financial product or strategy that makes you feel uncomfortable.

And if at the end of our session you decide to take my advice and do it yourself or bring it back to your current advisor that is your option. We will still part friends, I promise.

Typically, we will sit down together for about an hour or so and my goal will be to answer as many questions for you as I can.

During our session, we will likely uncover several ideas that could put you thousands of dollars ahead, or we will expose several big mistakes that could easily be avoided.

There is NO cost for this meeting and nothing to buy at this point.

Does this sound like something that would be helpful to you? If so be sure to book your strategy session today! Click Here Now!


Disclosure: Investment Advisory Services offered through Retirement Wealth Advisors, LLC. (RWA) a Registered Investment Advisor. Rockford Retirement Planning, Inc. (RRP,Inc.) and RWA are not affiliated. Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance. Past performance does not guarantee future results. Consult your financial professional before making any investment decision.

This information is designed to provide general information on the subjects covered, it is not, however, intended to provide specific legal or tax advice and cannot be used to avoid tax penalties or to promote, market, or recommend any tax plan or arrangement. Please note that RRP,Inc. and its affiliates do not give legal or tax advice. You are encouraged to consult your tax advisor or attorney.

Annuity guarantees rely on the financial strength and claims-paying ability of the issuing insurer. Any references to protection benefits or lifetime income generally refer to fixed insurance products. They do not refer, in any way to securities or investment advisory products or services. Fixed Insurance and Annuity product guarantees are subject to the claims
‐paying ability of the issuing company and are not offered by Retirement Wealth Advisors, LLC.

Social Security/Government Program Disclosure: Antonio Filippone of Rockford Retirement Planning, Inc and Retirement Wealth Advisors, LLC are not affiliated with or endorsed by the Social Security Administration or any other government agency

MDRT Disclosure: The Million Dollar Round Table is a trade association to help insurance brokers and financial advisors establish best business practices and develop ethical and effective ways to increase client interest in financial products, specifically risk-based products like life insurance, disability, and long-term care. Annual qualification requirements include demonstrating a set annual production requirement and agreeing to a code of ethics but are not based on client experience or performance. For more information regarding the Million Dollar Round Table eligibility, please see
https://www.mdrt.org/membership/requirements/. Membership in no way constitutes an endorsement from Million Dollar Round table or any client.

Top of the Table:To qualify for top of the table a member must demonstrate an annual commission of six times the base requirement.

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