Income Tax Considerations for Working Retirees

Part-time wages count as earned income. Combining part-time earnings with taxable pension distributions, traditional IRA withdrawals, or Social Security can push you into a higher federal income tax bracket. Furthermore, earned income may render up to 85% of your Social Security benefits subject to federal income tax if your combined income exceeds standard thresholds ($25,000 for single filers; $32,000 for married couples filing jointly).

Most community centers hire staff as standard W-2 employees, meaning they automatically deduct FICA taxes (6.2% Social Security and 1.45% Medicare) alongside standard income tax withholdings from your paychecks. If you work as an independent contractor or workshop instructor paid via Form 1099, set aside roughly 15.3% of your net self-employment earnings to cover self-employment taxes.