Despite the actual tax rate reductions for this Jobs and Growth Tax Relief Reconciliation Act of 2003, the top marginal tax bracket for many retirees can be a whopping 46.3%. Why? Because Social Security benefits are subject to income income tax. Those affected are Social Security recipients who have the good fortune (misfortune?) end up being subject to both the 25% tax bracket and the 85% inclusion rate for Social Security benefits.
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