Tax Mistakes Retirees Make: Five Lines to Check Before You Sign.

A retired couple gets their return back from the preparer, turns to the signature line, and signs under a sentence that begins "Under penalties of perjury, I declare that I have examined this return." Most people haven't, not in any way that would let them explain it. The tax mistakes retirees make rarely look like mistakes. They look like reasonable numbers on lines nobody walked them through, and a retiree's return has more of those lines than a working person's.

Up to 85% of your benefits can be taxable under IRC §86, depending on provisional income: your other income, plus tax-exempt interest, plus half your benefits. Past $32,000 of provisional income on a joint return ($25,000 single), benefits start becoming taxable, and past $44,000 ($34,000 single) the 85% tier kicks in. Those thresholds aren't indexed, so they're the same for 2026 as they were in 1994.

The formula rarely breaks. The inputs do. Line 6a takes box 5 of the SSA-1099, not the smaller deposit that hit your bank after Medicare premiums came out, and entering the deposit invites a CP2000. Back benefits paid for an earlier year may qualify for the lump-sum election on line 6c, which can shrink the taxable amount. And married couples who file separately without living apart all year get no threshold at all: a base amount of zero under §86(c)(1)(C).

Every withdrawal arrives on a Form 1099-R, and two boxes decide what it costs: the distribution code (box 7 on the 2025 form, 7a on the 2026 form) and the taxable amount in box 2a. A 60-day rollover is the classic miss: the 1099-R reports it like any other code 7 (normal) withdrawal, and only your return can say the money went back in.

The bigger leak is basis. If you ever made nondeductible IRA contributions, part of every withdrawal is money you already paid tax on, and the custodian doesn't know it. Your record is the Form 8606 filed the year you contributed. Under the pro-rata rule of §408(d)(2), $40,000 of basis in a $400,000 IRA makes about a tenth of each withdrawal tax-free. Lose the 8606 trail and you pay tax on those dollars twice. Pensions with after-tax contributions work the same way under the Simplified Method of §72(d), if someone runs it.

A qualified charitable distribution (QCD) under §408(d)(8) sends IRA money straight to charity once you're 70½, up to $111,000 per person for 2026, and keeps it out of income entirely. The 1099-R usually won't show it. Box 2a typically reports the full amount as taxable, and the code Y the IRS created to flag QCDs is optional for 2025 and again for 2026. On the 2025 Form 1040, you claim it by putting only the non-charitable part on line 4b and checking the QCD box on line 4c. A lot of preparers miss it, and the cost doesn't stop at line 4b.

IRMAA (Medicare's income-related monthly adjustment amount) comes from your tax return two years back under 20 C.F.R. §418.1135, so 2026 income sets 2028 premiums. For 2026 it starts above $109,000 of modified AGI (AGI plus tax-exempt interest) single or $218,000 joint, and it's a cliff: one dollar over adds $81.20 a month to the $202.90 Part B premium plus $14.50 for Part D, per person. That's $2,296.80 a year for a couple. A Roth conversion or a large capital gain is the usual trigger, and the time to size it is before December 31.

It works in reverse, too. If your first retired year's premiums were set by your last salaried year, Form SSA-44 asks Social Security to use your current income instead, and retirement counts as a qualifying work stoppage. Nothing happens unless you file it.

For 2025 through 2028, IRC §151(d)(5)(C) gives every taxpayer 65 or older by year end an extra $6,000 deduction, $12,000 on a joint return where both qualify. It goes on Schedule 1-A and line 13b of the 2025 Form 1040, whether you itemize or not. Each person's $6,000 shrinks by 6 cents per dollar of modified AGI above $75,000 single or $150,000 joint, so an extra $10,000 withdrawal inside that range costs a qualifying couple $1,200 of deduction. Filing separately forfeits it, and each person needs a valid Social Security number on the return.

None of these mistakes is arithmetic. Software gets every line right from whatever it's given, and each miss is a fact it never received, like a gift sent straight from the IRA to a church. Those facts only reach the return through a conversation, so every return I prepare ends with one. We sit down together and go through it line by line, and you know what you're paying and why before you sign.

A client once asked me to review her 2024 return. Her prior preparer had her filing separately from her husband, and when I asked why, she said the preparer told her it didn't really make a difference. It made a $9,000 difference, and I amended the return for a refund of roughly that much. For a retiree, filing separately costs even more.

You'll work with me, the same person every year, not a different preparer each season and not a call center. That matters more in retirement because the returns are chained together: 8606 basis carries forward until the IRA is empty, and this year's AGI lands on a Medicare bill in two years. I'm an Enrolled Agent, licensed by the IRS with unlimited practice rights under Circular 230, so if the IRS ever writes, you call me and I handle it.