In addition to social security benefits of 8000, Mr and Mrs Wells have adjusted gross income of 32,000 and tax exempt interest of 1000 and will file a joint return. The taxable portion of the social security benefits will be?
The taxable portion is calculated as follows:
Add the $32000 of income plus $1000 of tax exempt income plus half of the social security = ...
The rules for determining the amount of social security income that is taxable are explained in the solution.