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Keep In Mind The COLA Letter You Got In December 2023. Here’s Why You Should Hold On To It

All Social Security beneficiaries received a crucial letter from the Social Security Administration at the end of the previous year informing them of their new COLA rise. Store that letter with your COLA details in a secure location in case you need it this year. If you intend to apply for credits or energy assistance, you may need to utilize the letter through the administration that outlines your new payment amount for 2024. Importantly, you can submit your COLA letter as evidence of the intended payment amount in your claim to the SSA if the initial COLA benefit you got in January wasn’t what you had anticipated.

Boost In The Monthly Benefits

The Social Security Administration mailed letters all through December, so you ought to have gotten your notice by now. However, get in touch with the SSA (Social Security Administration) right away if you believe you may have thrown it away or misplaced it. If the letter is misplaced, the agency can assist you in finding it or replacing it. In 2023, Social Security recipients saw a record-breaking boost in their monthly benefits of 8.7% for cost of living adjustments. Because of the larger monthly payments, you may owe more taxes this year, which could make paying taxes a little more challenging. You probably aren’t required to submit a tax return if your main source of income is Social Security benefits, but this assertion can help you find out. The COLA rise may have put you in a greater tax bracket if you had additional income, like from a job, we’ll clarify.

If you created a My Social Security account online before November 15, 2023, you may be able to access your 2024 benefit amount online. If so, the Messages Centre will provide you with access to your statement. If not, you will have to wait after requesting a fresh letter for it to come. Find out more about if this year’s COLA hike will impact your taxes. Furthermore, here’s how to obtain your tax refund the quickest if you anticipate receiving one this year.

If You Have Additional Sources Of Income

Not every recipient will observe a tax adjustment. As previously stated, you normally aren’t required to submit a tax return if your main source of income is Social Security payments; therefore, you fail to pay taxes on the benefits you receive. Based on the amount of money you make, you can pay more in taxes if you have additional sources of income in extra to your benefits. This is because the threshold for taxation for those who submit taxes has remained the same, notwithstanding the 8.7% increase in your benefits. More people may pay more in taxes as a result of that rise.

Up to 50% of your benefits may be subject to income tax if you file as a single and your total income ranges between $25,000 & $34,000. Income tax may be due on as much as 85% of the benefits you receive if you file as a single and your total income exceeds $34,000. A maximum of fifty percent of your benefits may be subject to income tax if you’re submitting a joint return & your combined earnings are between $32,000 – $44,000. You may be required to pay taxes on income on as much as 85% of your benefits if you’re reporting a joint return as well as your combined salary is more than $44,000. If you are married and filed separately from your spouse during the previous year, you will be taxed on your benefits from Social Security as though you were the sole filer.

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