These 5 Income Sources Are Taxable in Retirement, so You'd Better Plan Around That
Some seniors find that money gets tight once they stop working. Such is the challenge of being retired. But one thing that tends to really throw seniors off-course is the fact that many common retirement income sources are subject to taxes. Here are a few you should know about so you can make a plan to cover your tax bill.
Unless Social Security is your only source of retirement income, there's a good chance you'll wind up having to pay taxes on some or most of those benefits. The income thresholds at which federal taxes for Social Security kick in are pretty low -- and they haven't changed in decades. So even if you consider yourself a fairly low earner, the IRS might still get a piece of your benefits.
In addition, there are 12 states that impose their own taxes on Social Security benefits. Some exempt lower-income seniors from those taxes, but it's important to know if your state is on this list -- and what its tax rules entail.
Source Fool.com
