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A wide range of Social Security benefits is available to U.S. citizens depending upon their circumstances. These benefits include retirement, disability, survivor, and family assistance as well as Supplemental Security Income. Survivor and family benefits for children are taxed similarly.
Key Takeaways
- Social Security survivor benefits paid to children are taxable to the child although most children don’t have enough income to be taxed.
- Survivor benefits aren’t taxable if they represent the child’s only taxable income.
- The benefits become taxable if half the child’s benefits plus other income is $25,000 or more as of 2025.
- Parents or guardians who receive retirement benefits on the child’s behalf aren’t responsible for paying taxes on them.
Survivor Benefits vs. Retirement Benefits
Social Security survivor benefits are paid to children whose parent is deceased and who are younger than 18 years old. This extends to 19 years old if they’re enrolled full-time in school. Stepchildren or grandchildren may also qualify for these benefits. Children can receive benefits at any age if they were disabled before they reached age 22 and remain disabled. Children can receive up to 75% of the deceased parent’s benefit.
Social Security retirement benefits are referred to as Family benefits when they’re paid out to a child after a parent has retired. Spouses, ex-spouses, and grandchildren can be eligible for these benefits as well. They can receive up to 50% of the retiree’s benefit amount.
Taxation of Survivor Benefits
Social Security survivor benefits for children are considered taxable income only for the children who are entitled to receive them. This is the case even if the checks are made out to a parent or guardian. Most children don’t make enough in a year to owe any taxes, however. Survivor benefits are only taxed if half of the child’s benefits in a year added to any other income they earn meets certain thresholds.
A portion of the benefits becomes taxable when half the annual benefits plus the child’s other income exceeds $25,000 in tax years 2024 and 2025.
Most checks for Social Security survivor benefits are made out to an adult on the child’s behalf. The amount of the benefits doesn’t affect the taxable income of the parent, however. The amount designated for the eligible child is subtracted from the check to determine the parent’s tax liability if both the parent and the child receive benefits.
Social Security benefits for children are never treated as taxable income for the parent or guardian.
Taxation of Retirement Benefits
A child who receives retirement benefits based on a parent’s work record may still be considered a dependent for tax purposes. This is the case if they live with the parent for more than half the year and the parent pays for more than half of their living expenses such as food, housing, clothing, education, and medical care.
Parents or guardians are responsible for filing and signing a tax return on the dependent child’s behalf if they’re required to file a return due to receiving Social Security benefits. The income thresholds for required filing are the same as for survivor benefits.
What Are Social Security Benefits?
Social Security benefits are essentially federal insurance benefits. Many people are eligible for these programs including disabled people, older adults with little to no resources, and retirees. Age 62 is the minimum age although there are monetary incentives for waiting longer to collect benefits. Surviving spouses, minor children, and unmarried ex-spouses of beneficiaries who have died may also be eligible.
What Is the Social Security Administration?
The Social Security Administration (SSA) is a federal agency that manages and distributes Social Security benefits. It was launched in 1935 with President Roosevelt’s signing of the Social Security Act and has several programs. It administers benefits for retirees, their survivors, people with disabilities, and older adults with little or no resources.
The SSA also assigns Social Security numbers and enrolls people in Medicare, the federal health insurance program for those who are 65 years old or over.
Are Social Security Benefits for Children Reported to the IRS?
All Social Security benefit payments are reported to the IRS. The recipient of the benefits receives an SSA-1099 form in January that includes the amounts of all benefits received during the previous year.
The Bottom Line
A child who is younger than age 18 or age 19 if they’re enrolled full-time in school can receive Social Security benefits if their parent dies. They can also collect family benefits when their parent retires. The IRS doesn’t treat Social Security benefits for children as income for the parent or recipient who receives the money on behalf of the child.
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