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September 11, 2023
Social Security benefits were once tax-free. That changed in 1983, when Congress decided to tax a portion of benefits for the highest-income recipients.
Back then, fewer than 10% of beneficiaries were affected. Lawmakers failed to update the law to account for inflation, however, so today most Social Security beneficiaries have to pay federal income tax on at least some of their benefits, says Ted Sarenski, author of American Institute of CPA's “Guide to Social Security Planning.”
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