Chapter 24: The Tax Torpedo
The worksheets from Chapter 24 of Fifty-Five. Type your own numbers, or try an example from the book to see how each one works.
Your taxable Social Security
How much of your Social Security counts as taxable income this year. It is a simplified version of the IRS worksheet in Publication 915; your tax software does the official version.
The formula: Provisional income = Other income + Tax-exempt interest + (Social Security ÷ 2). At or below the first line, none is taxable. Between the lines: (Provisional income − First line) ÷ 2, but no more than half your Social Security. Above the second line: 85% × (Provisional income − Second line) + the smaller of half your Social Security or $4,500 single ($6,000 joint). Never more than 85% of your Social Security.
The calculator needs JavaScript. The paper worksheet below does not: it is the same arithmetic, written out.
The paper worksheet
Other income $__________ + Tax-exempt interest $__________ + Half your Social Security $__________ = Provisional income $__________
If above the second line: Provisional income $__________ − Second line $__________ = $__________ × 0.85 = $__________
$__________ + the smaller of half your Social Security or $4,500 (single) / $6,000 (joint) $__________ = Taxable Social Security $__________
Cap: Social Security $__________ × 0.85 = $__________. Use the smaller of this and the line above.
Walk through it, step by step
- Add up everything on your return except Social Security. Use the Form 1099s for your IRA, pension, interest and dividends.
- Add any tax-exempt interest, from your brokerage 1099.
- Add half of your yearly Social Security, from your Form SSA-1099 (box 5).
- Compare the total with the lines for your filing status.
- Use step 3 or step 4 of the formula, whichever applies.
- Check it against the 85% cap.
Check your answer
- Your answer can't be more than 85% of your benefit.
- If your provisional income is just over the second line, your taxable Social Security should be close to $4,500 (single) or $6,000 (joint).
- Your tax return, Form 1040, line 6b, shows the taxable amount the official worksheet produced. Yours should be close.
Figures this worksheet uses, and where they come from: Lines for taxable Social Security ($25,000 and $34,000 single, $32,000 and $44,000 joint), the 50% and 85% rules, and the $4,500 and $6,000 amounts (IRS, Publication 915).
Your torpedo rate
What an extra dollar of IRA money really costs you in federal income tax, when that dollar also pulls more of your Social Security into taxable income.
The formula: (1 + the share of Social Security each dollar pulls in) × Your bracket = Your torpedo rate
The calculator needs JavaScript. The paper worksheet below does not: it is the same arithmetic, written out.
The paper worksheet
(1 + Share ______) × Your bracket ______% = Your torpedo rate ______%
Walk through it, step by step
- Work out your taxable Social Security with the worksheet above.
- Do it again with $1,000 more of other income.
- Subtract. If the difference is $850, your share is 0.85. If it's $500, it's 0.5. If it's $0, you're past the torpedo.
- Find your bracket from the 2026 tables (Chapter 7).
- Multiply.
Check your answer
- Your torpedo rate should be between your bracket and 1.85 times your bracket.
- If your taxable Social Security is already 85% of your benefit, your torpedo rate is just your bracket.
- Older taxpayers get a larger deduction, and a temporary extra deduction for people 65 and older applies for 2025 through 2028. That extra deduction shrinks at higher incomes, which can add a little more to the real rate. Your tax preparer can run the exact number.
Figures this worksheet uses, and where they come from: The 50% and 85% rules for taxable Social Security, which give the 0.5 and 0.85 shares (IRS, Publication 915).
Your room under the IRMAA line
How much more other income you can take this year before you cross the first IRMAA line, when part of the trip is inside the torpedo.
The formula: Part 1: Other income where your torpedo ends − Your other income now = Torpedo room. Torpedo room × 1.85 = What it adds to MAGI. Part 2: IRMAA line − (MAGI now + What the torpedo room adds) = Room after the torpedo. Part 3: Torpedo room + Room after the torpedo = Your total room.
The calculator needs JavaScript. The paper worksheet below does not: it is the same arithmetic, written out.
The paper worksheet
Torpedo ends $__________ − Other income now $__________ = Torpedo room $__________ × 1.85 = $__________
MAGI now $__________ + What the torpedo room adds $__________ = MAGI after the torpedo $__________
IRMAA line $__________ − MAGI after the torpedo $__________ = Room after the torpedo $__________
Torpedo room $__________ + Room after the torpedo $__________ = Total room $__________
If you're already past the torpedo, skip to part 2 with nothing added: IRMAA line − MAGI now = Your room.
To find where your torpedo ends: Second line + (85% of your Social Security − the smaller of half your Social Security or $4,500 single / $6,000 joint) ÷ 0.85 − half your Social Security.
Walk through it, step by step
- Work out your MAGI now: other income plus taxable Social Security (the first worksheet in this chapter), plus any tax-exempt interest.
- Work out where your torpedo ends with the formula above. If 85% of your Social Security is already taxable, you're past it: go to step 5.
- Subtract your other income now from where the torpedo ends. That's your torpedo room.
- Multiply it by 1.85 and add it to your MAGI now. That's your MAGI after the torpedo.
- Subtract that MAGI from the IRMAA line. That's your room after the torpedo.
- Add the torpedo room and the room after it. That's how much more other income you can take this year.
Check your answer
- Add your total room to your other income now, and run the taxable Social Security worksheet on that total. Add the two. You should land right on the IRMAA line.
- Leave a cushion. A surprise capital gains distribution in December can push you over.
Figures this worksheet uses, and where they come from: Lines for taxable Social Security ($25,000 and $34,000 single, $32,000 and $44,000 joint), the 85% rule, and the $4,500 and $6,000 amounts (IRS, Publication 915); 2026 first IRMAA line: $109,000 single, $218,000 joint (SSA, Premiums: Rules for Higher-Income Beneficiaries).