How are Social Security benefits taxed?
Some Social Security benefits can be included in federal taxable income, depending on how much other income you have. Many people with modest other income owe no federal tax on their benefits at all.
The IRS test adds one-half of your benefits to all your other income — including tax-exempt interest — and compares the total with a base amount set by filing status. Above that base amount, generally up to 50% of benefits can be included in taxable income; at higher levels, up to 85%.
That 85% is the most of your benefits that can be counted as income, not a tax rate. The counted portion is taxed at your ordinary income-tax rates, the same as other income.
Reviewed by Bay Area Wealth Advisors. Last reviewed 2026-09-26. Educational information only — not individualized financial, tax or legal advice.