Why Reaching 73 in 2027 Could Increase the Taxes on Your Social Security

Turning 73 does not change the amount of your Social Security benefit. But for people who reach that age in 2027, a tax rule can alter how much income the IRS counts, which may push more of those benefits into taxable territory.

The issue is the required minimum distribution, or RMD, a mandatory withdrawal from certain retirement accounts. It is not a Social Security rule, but the two systems overlap in a way that can surprise many retirees. The timing of that first withdrawal can matter more than it first appears.

What a required minimum distribution is

An RMD is the minimum amount the IRS says you must take each year from certain tax-deferred retirement accounts once you reach age 73, according to the IRS. The rule applies to traditional IRAs, SEP IRAs, SIMPLE IRAs, and most employer plans such as a 401(k). Roth IRAs are not subject to RMDs during the original owner's lifetime, and designated Roth accounts inside a 401(k) or 403(b) are also exempt while the account owner is alive, per IRS guidance.

People who are still working for a company that sponsors their retirement plan may be allowed to postpone RMDs from that plan until they retire, unless they own more than 5% of the business, the IRS says. That exception does not apply to IRAs.

The amount is not random. It is calculated by dividing the account balance as of December 31 of the previous year by a life-expectancy factor from the IRS Uniform Lifetime Table in IRS Publication 590-B. In general, a bigger balance or older age leads to a larger required withdrawal, and that withdrawal counts as ordinary taxable income.

The first-RMD deadline and the risk of two distributions in one year

The IRS gives some flexibility for the first RMD. You can take it by December 31 of the year you reach 73, or you can wait until April 1 of the following year, according to the IRS. For someone reaching 73 in 2027, that means the first RMD could be delayed until April 1, 2028.

That flexibility has a downside. If you postpone the first RMD into the next year, you still must take the second RMD by December 31 of that same year. In effect, delaying the first withdrawal can mean two taxable distributions arrive in one tax year, which may push you into a higher tax bracket and increase how much of your Social Security benefit becomes taxable that year. The IRS gives similar examples: someone who reaches 73 in 2025 and delays the first RMD until April 1, 2026, must also take a second RMD by December 31, 2026, resulting in two withdrawals during the same calendar year.

How taxation of Social Security benefits works

Social Security benefits can become partially taxable based on a measure called combined income, sometimes referred to as provisional income. The Social Security Administration defines combined income as adjusted gross income plus any tax-exempt interest plus half of your annual Social Security benefits.

The income thresholds, which have not been indexed for inflation since they were set by law, are listed below, according to the IRS:

Single filers or head of household

With combined income between $25,000 and $34,000, up to 50% of benefits may be taxable. Above $34,000, up to 85% may be taxable.

Married couples filing jointly

With combined income between $32,000 and $44,000, up to 50% of benefits may be taxable. Above $44,000, up to 85% may be taxable.

Married individuals filing separately who lived with their spouse at any point during the year

They generally have no threshold at all, meaning benefits may be taxable regardless of combined income, per IRS guidance.

One point that often causes confusion: having up to 85% of your benefits taxable does not mean you face an 85% tax rate. It means up to 85 cents of every benefit dollar is added to taxable income, where it is then taxed at your regular marginal income tax rate, not at 85%.

A before-and-after example

Consider a hypothetical single filer who receives $2,071 a month in Social Security, which matches the Social Security Administration's estimated average monthly benefit for a retired worker as of January 2026. That equals about $24,852 a year in benefits.

Before the first RMD: Suppose this retiree's only other income is $10,000 a year in pension income, with no taxable IRA withdrawals yet. Half of Social Security benefits ($12,426) plus other income ($10,000) equals combined income of about $22,426, below the $25,000 threshold. In this case, none of the Social Security benefit would be taxable.

After the first RMD: Now assume the same retiree reaches 73 and takes a first RMD of $15,000 from a traditional IRA, in addition to the $10,000 in pension income. Combined income becomes roughly $12,426, representing half of benefits, plus $25,000 from pension income and the RMD, or about $37,426. That crosses both the $25,000 and $34,000 thresholds for single filers, meaning up to 85% of this retiree's Social Security benefit could now be included in taxable income, according to IRS rules. The retiree has not lost any Social Security benefit, but more of it is now subject to tax.

This is a simplified hypothetical illustration. Actual combined-income calculations depend on a worksheet in IRS Publication 915 and should include all income sources.

Turning 73 does not change your benefit amount

Nothing about reaching 73 changes the dollar amount of your Social Security check. The RMD rule is part of the tax code that governs retirement accounts. What changes is your taxable income picture, which can affect how much of your already-set Social Security benefit the IRS treats as taxable. Your Social Security payment itself stays the same unless there are separate changes, such as a cost-of-living adjustment or a shift in Medicare premiums withheld from the check.

Why this matters for retirement planning

Because the RMD rule and the Social Security tax-threshold rule interact but are not formally linked, a retiree can move from owing little or no tax on benefits to having a meaningful share taxed simply because an account balance has entered RMD territory. People approaching 73 may want to review projected RMDs, pension income, and other withdrawals together rather than examining Social Security taxation on its own. The IRS offers worksheets in Publication 915 to help estimate combined income, and the SSA's online tools can help retirees understand how benefits interact with other income. A tax professional or financial advisor can also help with projections based on individual accounts and filing status.

Bottom line

Reaching 73 does not reduce your Social Security benefit, but it can trigger required withdrawals that increase taxable income and pull more of that benefit into taxable territory, especially if a delayed first RMD causes two distributions to fall in the same tax year. Understanding combined income, and the difference between a higher taxable percentage and a higher tax rate, can help retirees avoid a surprise at tax time.

Checking account balances and projected RMDs well before the year you reach 73 can provide more flexibility in managing withdrawal timing and the resulting tax impact, something the IRS worksheets and a qualified tax advisor can help explain.