Which TurboTax Does a Retiree on Social Security Need?
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In retirement, your income usually shifts from a paycheck to a mix of Social Security, pensions, and withdrawals from retirement accounts like IRAs and 401(k)s. Social Security comes on an SSA-1099, and your pension or retirement account distributions come on 1099-R forms. How much of your Social Security is taxable depends on your total income, so some retirees pay tax on a portion of it while others pay none at all.
The return itself is often fairly simple if your income is just these sources and you take the standard deduction, which is larger once you're 65 and older. It gets more involved if you have a taxable brokerage account, rental income, required minimum distributions to track, or you itemize because of high medical costs. The right edition really depends on which of those apply to you.
TurboTax Deluxe (Online)
Deluxe is a comfortable fit for most retirees. It handles Social Security, pensions, and retirement distributions, and it really shines when you have deductions to maximize, like significant medical expenses or charitable giving that might make itemizing worthwhile. It also runs a thorough deduction search. If your situation is very simple, Free Edition may even cover it, so start there if your income is modest.
Alternatives to consider
Don't overlook retirement-friendly breaks
Filers 65 and older get a larger standard deduction, which the software applies automatically. If you give to charity from an IRA through a qualified charitable distribution, that can keep income off your return entirely, but it has to be entered correctly. High medical expenses can also tip you into itemizing. Deluxe asks about these so you don't leave a break on the table.
Frequently asked questions
Is my Social Security taxable?＋
It depends on your total income. Some retirees pay no tax on their benefits, while others pay tax on a portion. TurboTax calculates the taxable amount once you enter all your income sources.
Do I even need to file in retirement?＋
It depends on your income level and sources. Even if you're not required to, filing may be worth it to recover any withheld tax. TurboTax helps you figure out whether you need to file.
What's Form 1040-SR?＋
It's a version of the 1040 made for taxpayers 65 and older, with larger type and a standard deduction chart. TurboTax uses the right form for you automatically.
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