Accomplished financial professional and CEO of Wendel Retirement Planning Jeffrey L. Wendel helps clients achieve their financial goals by helping them make sound fiscal decisions based on his years of expertise. Not only does Jeffrey L. Wendel and his team assist with insurance, estate planning, and retirement planning, they also educate clients on Social Security and taxes so they can better protect their assets.

To determine whether your Social Security benefits are taxable or not, you must determine how much your combined income, or provisional income is. This is determined by adding together nontaxable interest, half of your Social Security benefits, and adjusted gross income from a job, pension, or other source of taxable income.

The IRS will only tax your Social Security benefits if your combined income is above a certain range. If you file as an individual, you are taxed when your combined income is above $25,000. When filing jointly as a married couple, this threshold increases to $32,000. Because of these limits, you may not be assessed any tax if Social Security is your only income.

Once you know whether you are taxed or not, you can determine how much you are taxed. Up to 50 percent of your Social Security benefits are taxed if your combined income is between $25,000 and $34,000 when filing as an individual. Combined income that is more than $34,000 results in 85 percent of Social Security benefits being taxed. As a married person filing jointly, the upper threshold is $44,000.

Keep in mind that having 50 percent or 85 percent of your Social Security benefits taxed does not mean you have to pay back 50 or 85 percent of the total benefits you get. Rather, only 50 percent or 85 percent of the total benefit is assessed taxes at your normal tax rate. For example, if you receive $2,000 in Social Security and are taxed on 50 percent of that, then only $1,000 of the total is assessed income tax.