Will money from stock sales hurt Social Security and Medicare?

Q. If you trade stocks and have capital gains, or sometimes losses, after you retire and only one spouse trades, how does that affect your social security and insurance costs? sickness ? We file our taxes jointly.

– Trader

A. We are happy that you are asking the question.

Let’s start with Social Security.

If you’re already retired and receiving Social Security benefits, the amount of other unearned income has no impact on Social Security benefits, said Brian Scheiss, certified financial planner at Modera Wealth Management in Westwood.

In other words, there is no threshold at which other unearned income reduces social security benefits in retirement, he said.

But a couple’s combined income can affect the amount of the benefit that is taxed.

Couples filing joint income tax returns will pay taxes on up to 85% of their combined Social Security benefits if their combined income is over $ 44,000 in 2021, Scheiss said.

If the combined income is between $ 32,000 and $ 44,000, only 50% of their benefits will be taxed, he said, while if the combined income is less than $ 32,000, none of their benefits will be taxed. imposed.

Combined income is your adjusted gross income plus tax-free interest plus half of your total Social Security benefits, he said.

Premiums for Medicare Part B and D increase with higher earnings, Scheiss said.

Premiums increase at certain levels when modified adjusted gross income (MAGI) exceeds certain thresholds. The higher premiums are called the monthly income-related adjusted amount.

However, he said, those cutoffs are based on combined income and both spouses’ Medicare premiums will be affected.

“Income from capital gains and other sources can impact health insurance premiums, but it doesn’t matter if one or both spouses are in the business,” he said.

Email your questions to [email protected].

Karin Price Mueller writes on Bamboo column for NJ Advance Media and is the founder of NJMoneyHelp.com. Follow NJMoneyHelp on Twitter @NJMoneyHelp. Find NJMoneyHelp on Facebook. Sign up for NJMoneyHelp.com‘s weekly electronic newsletter.