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he contends that the Social Security benefits are not includable
in gross income.
Section 86 governs the taxability of Social Security
benefits. That section, which is complex and cannot be parsed
easily, provides in relevant part:
(a) In General.--
(1) In general.--Except as provided in paragraph
(2), gross income for the taxable year of any taxpayer
described in subsection (b) (notwithstanding section
207 of the Social Security Act) includes social
security benefits in an amount equal to the lesser of--
(A) one-half of the social security
benefits received during the taxable year, or
(B) one-half of the excess described in
subsection (b)(1).
(2) Additional amount.--In the case of a
taxpayer with respect to whom the amount
determined under subsection (b)(1)(A) exceeds the
adjusted base amount, the amount included in gross
income under this section shall be equal to the
lesser of--
(A) the sum of--
(i) 85 percent of such excess, plus
(ii) the lesser of the amount
determined under paragraph (1) or an
amount equal to one-half of the
difference between the adjusted base
amount and the base amount of the
taxpayer, or
(B) 85 percent of the social security
benefits received during the taxable year.
(b) Taxpayers to Whom Subsection (a) Applies.--
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Last modified: May 25, 2011