 Here we are in our example form 1040 populated with Lassert tax software. You don't need tax software to follow along, but it's a great tool to run examples and scenarios with. You can also get access to the form 1040 and related schedules and forms on the IRS website, irs.gov, irs.gov, starting point. As usual, single filer, Mr. Anderson, no dependence, 100,000 in the W2 income. And then we've got the 12,950 standard deduction getting us to the 87,050 and mirroring that on our equation over on in Excel, where we got the 100,000 to 12,950 taxable income, 87,050. Depending on the software to do the calculation on page two, that being 14774. So we've got the 14774 and then 15,000 withheld to get us to the 226. That's our general starting point we've been starting with. Now, when we're talking about payments that are coming out of the social security, normally that's going to be people that are in their retirement years. So I'm going to change the age here to put them into a time frame where it's likely they're going to be getting social security benefits. Note that would be the normal expectation. If they're in their working years, you would expect most of their income to be coming from, say W2 income. If beyond the working years, you would expect distributions possibly from IRAs, pension plans, interest dividends, income type of sources, and then possibly, of course, the social security, our point of focus now. So now I've changed the income, the age. So so now it's switched us over to a 1040 SR instead of a 1040. I'm still going to go back to the 1040 because I think that's just an easier format or a more standard format if you've been working on the 1040s for a while to get an idea of what's going on. So it's a single filer. We've got the we're born before January 2nd, 1958. We've got the 100,000 that I left in the W2 income, although if they were retired, it's likely that they wouldn't have the 100,000 from here, it would be in IRAs or pensions and whatnot. But the basic idea is that if we have that income that's over a certain threshold, then we're going to have some taxable portion of the social security benefits. So if you're dealing with people that have significant amounts of income and they ask you what's going to happen to my social security benefit income, well, you're probably going to have to include it 85 percent of it in income. So if you have $100,000 here, social security benefits of 2000, the calculation is point eight five. And that's given us the 1,700. That's going to be the taxable portion. That's going to be the general concept. If the income is fairly below a fairly low threshold, then you might be taxing something or have include in taxable income, something less than 85 percent. Now, remember that 85 percent isn't the tax you're paying on it. That's the amount that has to be included in taxable income in order to then get to the to calculate the tax on the taxable income. And then we changed our standard deduction because we're over the threshold 65. So let's go back on over here and say, all right, let's say that we've got the income now and now we've got social security social security card income. So that's like on page one. So let's say that I'm going to add another line pension. Let's just add a few more lines here. I'm going to insert some lines and then I'm just going to call this. What should I call it? Social security benefits. Social security security benefits, something like that. That's close. The spell check should be able to figure that out. And then I'm going to leave a couple of spaces, usually like two lines, because you got husband, wife is usually maybe will add an extra, just in case there's some some weird scenario or something. Always weird scenarios these days. I'll tell you what. So we're going to say social security benefit payment was 2000. Now, you can kind of do the calculation here and say it's going to be 85 percent. So you might you might try to do like actually see the calculation. So let's actually add a column. I'm going to add a whole column to this and push column C to the right by putting my cursor on column C, right click and insert. And then I'm going to add another kind of calculation here. So all this stuff doesn't need to be any special formatting down to here. So I'm going to say on on I'm going to get rid of the colors on those. But then down here, I'm going to add another column and I'll put like normally it's point eight five eighty five percent point eight five. Or maybe I put the eight five. Let's put the eight five like down here point eight five point eight five. And I'm going to make that a percent. And so then I'm going to say this is going to be equal to this times. Eighty five percent. And so this would normally be something that you wouldn't have to basically change, but you might because they might be a rate other than eighty five. And in that case, I'd probably be dependent on the software to do the calculation. And so then I'm going to say this is the total total social security benefits summing that up to the outside sum it up. Poor far bore there we have it. Let's do the spell check that can't be spelled right. If there's something if the spell check doesn't say something wrong, there's something wrong with the spell check social security. OK, so then that should be included down here. So I'm going to update that formula. So now we're at the one oh one seven hundred pulling into page one. Boom. This needs to be increased because they're no longer over the threshold to get an extra over the standard of the one thousand seven fifty. There's that. Bam. That gets us to the eighty seven thousand eighty seven thousand over on the tax return is their page two. Doing the calculation is now at the fourteen seven sixty three. So we'll say, OK, fourteen one four seven six three is there. And fifteen thousand gets us down to the two thirty seven. So there's the general idea.