Tax time - Newly married, wife got Soc Sec and other benefits, what is taxable?

ksbsnowowl

ksbsnowowl

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Hi everyone,

I'm newly married (5 months ago), and 2006 was my first year of full-time work after graduating college, so this is all a bit new to me. I am filing as Married Filing Jointly.

Now, my wife is deaf (I'm hearing), and as such she got roughly $600 a month from Social Security prior to our marriage. However, this is something different than Social Security Disability Income (or so I've been told). Her parents run a farm, and as such, she's never really paid taxes before (the family didn't make enough).

After we married, my wife no longer qualified for the Social Security she got every month (I made too much money). So, she got $600/month from Jan - Aug. She has never recieved W2's or anything related to paying taxes on this money, ever.

While walking through Turbotax, it says SSDI is taxable. Is what my wife recieved SSDI or something else? If something else, what is it?

Is what my wife recieved taxable?

My wife is also still a college student. The State of Wisconsin has a Department of Vocational Rehabilitation (DVR) that supports disabled individuals that are working toward college degrees. For both the Spring 2006 semester and the Fall 2006 semester she recieved $2000 ($4000 total). The workers at the DVR office told her that she did not have to report this money to the IRS.

Is it actually taxable?

That ends the deaf-specific portions of my tax questions, but I'll add one more just in case someone happens to know...

My wife also has recieved many grants and scholarships to pay for college (she's very smart), as well as a small amount of governement student loans. As of right now (the start of the Spring 2007 semester) she has more than $4000 in excess grants, that she can have released from the university and do with it as she pleases (some of this is left-over from Fall 2006, but not all of it; some is from Spring 2007). Turbotax states that grants and scholarships not used for tuition, books, and supplies (so, grant money used for room and board, and other things not directly tied to learning) are treated as taxable income (which is news to me, as well as my parents...I'm sure very few college students ever report the scholarships they used for room and board). So, do I really need to report this extra money? I'm sure I should, but I've never heard of doing so before now.

If anyone has any insight on what I need to report I would be greatly appreciative.
 
If I were you, I would pay the IRS a visit at Internal Revenue Service There's plenty of information you can find for ur tax situation.

And ofc taxes are a headache...trust me Ive been doing taxes for a pretty long time it makes my head spin. :lol:
 
SSI is never taxable income as far as I know for sure! On other hand with SSDI, that is whole different story. Half of SSDI income is taxable ONLY if this is true, if single makes more than $25 thousand dollars a year including SSDI, OR married couple together gets more than $32k a year including SSDI income.

Here is good example for married couple

Husband earns 15K a year(GROSS), and wife got 12k a year on SSDI, then you would add it together and it would be $27K a year so therefore it falls below the minimum, then there is NO taxes on these SSDI and need not to be reported to IRS.

Husband earns $25k a year(GROSS), and wife earns $12k a year, and add both together would yield $37K a year then that half of SSDI income is taxable, meaning that total of $31K is fully taxable, and the remaining $6k of SSDI is NOT taxable.

If they were never married but live together, then SSDI is not subject to the other's income for taxable purpose.
 
Personally, I don't think I'd file my taxes based on information that I got from a discussion forum. If you end up facing an IRS audit, ADers aren't going to be there to back you up, and they aren't going to pay the tax penalities.
 
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