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Social Security benefits timing

Next year I'll start receiving Social Security benefits. They are paid a month in arrears, so that the benefit for December 2019 will actually be paid in January 2020.

If this were salary, that payment for December, made in January, would be 2020 income, not 2019 income. Is it the same for Social Security -- benefits are income in the year when the payment is made available to me, not the year for which it is paid?

(I know I'll find out the answer when I get a Form 1099 early in

2020. But I like to estimate my tax in advance due as closely as possible, so that I can have appropriate amounts withheld since I'm still working.)
Reply to
Stan Brown
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I see no reason to believe differently.

-- Arthur Rubin, Brea, CA

Reply to
Arthur Rubin

Yes, it's the same. Your Form SSA-1099 for 2019 will report the amount that was paid to you IN 2019. The payment you receive in January 2020 will be included in your SSA-1099 for 2020. It doesn't matter what year the payment is FOR.

For cash basis taxpayers, which includes just about all individuals, the general rule is that you report income in the year that you receive it, no matter what year it is for.

Bob Sandler

Reply to
Bob Sandler

Thanks, Bob and Arthur. For cash-basis taxpayers (of which group I am a member), income is taxable in the year when it's paid, regardless of what year it's for.

Reply to
Stan Brown

If this were salary, that payment for December, made in January, would be 2020 income, not 2019 income. Is it the same for Social Security -- benefits are income in the year when the payment is made available to me, not the year for which it is paid?

(I know I'll find out the answer when I get a Form 1099 early in

2020. But I like to estimate my tax in advance due as closely as possible, so that I can have appropriate amounts withheld since I'm still working.)

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Note that under the law, you are not entitled to a particular month's SSA benefit until that month completes, i.e. the right accrues on the first day of the FOLLOWING month. Therefore, your actual receipt in the following month of the benefit month is the same as constructive receipt, and appears (at least if timely paid) accounting method invariant.

Reply to
D. Stussy

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