Taxes

Complaining about taxes is not unique to seniors or in my case maybe a super senior, but they are mighty vocal and prolific on the internet. I was curious, how much could a age 65+ couple earn in retirement before actually paying federal income taxes on their money?
I ran a couple of scenarios using AI tools. I was a bit shocked at the results. Here is an example …
I asked what a couple both age 65 + with combined SS benefits of $50,000,

EVERY ARTICLE ABOUT Roth conversions says the same thing: pay the tax from taxable money, not from the IRA.
That is good advice if you have taxable money.
Plenty of retirees do not. Their savings sit almost entirely in a traditional IRA, built from years of 401(k) contributions and a rollover at retirement, with little brokerage money and no cash reserve worth naming.
For them, “pay from outside money” is not advice. It is a condition they do not meet.

AFTER YEARS OF heady gains in the stock market, many investors are facing the same question: To manage risk, they’d like to cut back on one or more of their holdings. But because of the potentially costly tax bill that might result, they aren’t sure exactly how to do that.
How can you square this circle?
One easy option would be to donate appreciated assets to charity. But that would make sense only if it aligns with your charitable goals and,

Along with changes to the application of the COLA there is discussion about changing the way and amount of income taxes applied to SS benefits.
It’s quite complex, but here is a link to some alternatives from the Committee for a Responsible Federal Budget. https://www.crfb.org/papers/new-approaches-social-security-benefit-taxation

THE WIDOW TAX is sold to the wrong households. It gets pitched to affluent couples as the reason to convert to a Roth or buy life insurance. The pitch says that when one spouse dies, the survivor files single, lands in a higher bracket, and gets clobbered. I ran the numbers for three couples at three incomes, and at the comfortable end the widow tax often costs nothing, or even less than nothing.
The real cost lands lower down,

Have any HumbleDollar readers who are subject to IRMAA filed a tax return more than 2 years late? If so, I’d love to hear your experience.

I read this article from Kiplinger online about the four ways couples should prepare for the Widow’s Penalty.
https://www.kiplinger.com/taxes/tax-planning/how-to-prepare-for-the-widows-penalty
The article states that in an unfortunate twist of the tax system, losing a spouse may trigger a huge financial hit called the widow’s penalty.  The good news – you can plan for it.  It is a good read. Your thoughts and your plan.

Many American’s perception of the taxes they pay is seriously distorted. Many seem to believe that withholding from their pay is the taxes they actually pay or that taxes due at year end reflect higher taxes rather than likely under withholding.
A major misunderstanding is that the tax bracket they are in represents their real tax rate. I know taxes are complicated, but not that complicated. 
I conducted a simple exercise. Using several AI tools I calculate the 2026 federal income tax for a household with two young children earning the US median income.

Do a Roth conversion in November or December and you’ve made a smart move in a low-income year. You’ve also just bought yourself a tax problem.
The IRS wants its money as you go, not in one lump next April. And for estimated payments, it grades you quarter by quarter. Say you convert $100,000 in December and the conversion generates a tax bill in the low $20,000s. Pay it all with a single January estimated payment and you might think you’re square.

We have recently considered buying another property closer to family.    Since selling our current home may take some time we were thinking we could possible use a retirement Roth account to come up with purchase price rather then take a bridge or other loan.  We also do not have enough after tax money in regular accounts to cover the total purchase.  We have been here for many years so it meets tax deduction for primary residence sale. 

IF YOU’RE IN YOUR early 60s and retired, you probably have a lot of financial questions on your mind. The next few years may be among your lowest-income and lowest-tax-paying years. Your salary and bonus years are behind you. Social Security and required minimum distributions from your IRAs and 401(k)s have not started yet. You are hearing advice about doing Roth conversions during this low-tax window, and the arguments are compelling. You may also be thinking about consulting or part-time work to stay active and bring in some income.

In February, Guindy Sam wrote about taxes on foreign dividends and taxes, and I decided to quantify the issue using data from the index provider MSCI.
Quick reminder: some countries tax dividends at the source when they’re paid, similar to payroll withholding tax. US taxpayers can claim credit for these foreign taxes paid on their returns (the Foreign Tax Credit). But investors who do not itemize this benefit — those holding the stocks in IRAs, 401(k)s,

Here are the results of an exercise to make Social Security last at least 75 more years. I used the Committee for a Responsible Federal Budget (CRFB) estimator.
✔️Increase the payroll tax rate by 2% shared by employers (1% each) or raise the 2% only on employers
✔️Eliminate the taxable wage cap, and also accrue additional benefits based on those taxed earnings using a 15% accrual rate. The same percentage as the lowest accrual or “bend point” uses now.

The amount of misinformation out there about Social Security is astounding and to me very disturbing.  I put this fact sheet together. I hope you will share the next time you hear one of the outrageous claims being made.
The basic funding mechanism has remained essentially the same since Social Security began:

Workers and employers pay dedicated payroll taxes (FICA).
Benefits are paid primarily from those payroll taxes.
Any surplus is invested in interest-bearing U.S. Treasury securities.

RDQ kicked off what I’d call a ‘good ruckus’ with his Billionaires, taxes and you post. I thought I would dive deeper into the “and you” aspect of the conversation. 
What about the rest of us? Below are the results of two 2025 tax returns I processed, and one based on the AARP calculator for tax year 2026. Two are retired couples over age 65. 
I included a hypothetical worker-bee couple as well,