Chances are good that Social Security benefits will be crucial for you during retirement. Obviously, you will need to know exactly how much monthly income those benefits will give you so you can make a good assessment of whether you are ready to leave work and support yourself without any wages.
Unfortunately, millions of people in America who are retired are now at risk of losing some of these benefits they might expect to get. Here is why.
If you live in these states, you might lose some of your Social Security benefits
Retirees are now at risk of losing some of their benefits if they live in any of these 13 states that charge state taxes on Social Security funds. The 13 states that tax your Social Security income include:
- New Mexico
- North Dakota
- Rhode Island
- West Virginia
Now, if you live in these states, it is not necessarily a given that you will always lose some part of your retirement income to your government because to its tax laws. That is because many states do not start enforcing a Social Security tax until a retiree hits a certain income amount. Most often, it is the upper middle class and those who are wealthy who find themselves in danger of losing some of their retirement funds to taxes, while low income retirees will not have this problem.
Still, there is a chance you might see some of your benefits stolen by your state if you reside in any of those 13 places. And if you want to ensure that does not happen, it’s a good idea to go to your state’s Dept. of Revenue so you can find out if you are liable for any tax rules on your benefits.
If it turns out that you will lose some of your Social Security money, consider moving — especially if your state has even more bad tax policies that could affect the income you will get as a senior. When you are on a fixed income, every dollar matters and losing some of your retirement checks to taxes might be a big hit you simply cannot afford.
Author: Blake Ambrose