In 2010, more than 54 million people in the United States received $58 billion in Social Security benefits. Social Security checks are distributed from three benefit programs -- retirement, survivors and disability -- tax-free. However, benefit payments are decreased through deductions authorized by the federal government. If beneficiaries owe taxes, federal debt or have support orders, the amounts owed are deducted from their Social Security checks.
Federal Income Taxes
Beneficiaries whose taxable income exceeds the Social Security Administration's income guidelines and owe federal taxes can have them deducted from their Social Security checks. Up to 25 percent of their Social Security checks can be deducted to pay taxes on a quarterly basis. If they owe federal taxes from previous years, the U.S. Treasury will levy their Social Security checks until the back taxes are paid up.
Social Security beneficiaries who have Medicare coverage must have certain premiums automatically deducted from their Social Security checks. Medicare is an entitlement health care program for people over 65 or who are disabled. Premiums automatically taken out of Social Security checks pay for Medicare Part B, which covers doctor visits and outpatient services. Premiums for Medicare Part D, which is the drug prescription coverage, can be deducted from Social Security checks at the beneficiary's consent.
Child Support and Alimony
If beneficiaries are ordered to pay child support or alimony, payments can be garnished from their Social Security checks to satisfy their obligations. Social Security Act 459 authorizes the legal enforcement of child support and alimony support orders by having monies owed by beneficiaries deducted from their Social Security benefits.
The U.S. Treasury, through the use of private collection agencies, is authorized via legislation to settle federal debt owned by individuals who receive Social Security checks. Through the Treasury Offset Program, TOP, the U.S. Treasury deducts payments from Social Security checks to pay back student loans that have been outstanding for 10 years.
- Social Security Administration: Congressional Statistics Alabama 2010
- Social Security Online: Withholding Federal Taxes From My Social Security Check
- SSR 79-4: Levy and Garnishment of Benefits
- Congressional Research Service: The Impact of Medicare Premiums on Social Security Beneficiaries
- Social Security Online: Social Security Act 459
- Department of the Treasury: U.S. Government Receivables and Debt Collection Activities of Federal Agencies