Do Recipients of SSI File Taxes?
Supplemental Security Income is a federal program for disabled, blind or aged individuals to receive funds for necessities. The Social Security Administration provides the guidance and work force to make this program successful in all 50 states. Funding comes from general revenue taxes, not from Social Security taxes. Federal guidelines determine who receives SSI. Unlike Social Security, the Internal Revenue Service does not tax any part of SSI benefits. SSI recipients may have other income that is taxable.
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Supplemental Security Income
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Federal benefits for SSI recipients in 2011 are $674 a month and some states supplement this amount. Social Security subtracts earned income from the $674 at 50 percent for months that the recipient earns income in excess of $65. Social Security subtracts unearned income above $20 at 100 percent. As an SSI recipient, you may have income other than SSI and continue to get some or all of your monthly benefit, depending on the source and amount. You may also have assets that produce income for you. Although your assets are restricted under SSI, you may earn interest or even rent from an asset. You may need to file a federal income tax return as a result.
Federal Income Tax
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Although the IRS exempts SSI benefits from taxation, SSI recipients are not exempt. Whether you must file a federal income tax return depends on your income, your filing status and your age. You may find it to your advantage to file a federal income tax return and claim credits that may be due you. If you have worked during the year, you may have taxes withheld that you can get back. You may also qualify for credits like earned income credit if your earned income is less than $13,460.
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Earned Income
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Earned income is money you make by working. In 2011, if you have more than $108.28 of earned income from a church or $400 from self-employment, you must file a federal income tax return. Your total income can only be $5 if you are married filing a separate return from your spouse and your spouse itemizes deductions.
Unearned Income
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Unearned income is interest, stock dividends or royalties as well as other income you don't work for. Unearned income requires filing at $950 for dependents under age 65 in 2011. If you are blind older than 65, your unearned income can total $2,350. If you are both blind and older than 65, you must file a tax return at $3,750 in unearned income in 2011. As a married dependent, your unearned income can be $2,050 if you are over 65 or blind. If you are both, the federal income tax filing requirement starts at $3,150.
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