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Despite brand new tax rate reductions among the Jobs and Growth Tax Relief Reconciliation Act of 2003, the top marginal tax bracket for many retirees is really a whopping 46.3%. Why? Because Social Security benefits are subject to income financial. Those affected are Social Security recipients who purchase the good fortune (misfortune?) pertaining to being subject to both the 25% income tax bracket and also the 85% inclusion rate for Social Security benefits.

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