The sales and property tax rates in these states tend to be higher to compensate, though. Social Security can't withhold state tax from your benefits, but it can withhold federal tax if you complete an authorization form. If you live in one of the states that impose tax, the exact amount you will pay varies based on state law.
If your income tax filing status is “married-filing jointly” and your combined income is over $32,000 then 50% of your Social Security benefits received during the tax year becomes part of your taxable income.
Social Security History
Category:
Taxable Income
Income-tax Purposes
In its Report, the Commission recommended that Social Security benefits be taxable: "The National Commission recommends that, beginning with 1984, 50% of OASDI benefits should be considered as
taxable income for
income-tax purposes for persons with Adjusted Gross …
3
Social Security History
Category: Taxable Income Income-tax Purposes