The FIRE Side Hustle Tax Trap Nobody Warns You About

Episode 97 of The FIRE Podcast uncovers a tax pitfall that quietly destroys the gains of early retirees who pick up part-time work or consulting gigs. Lucas and Luna walk through the specific interaction between Social Security earnings limits, the Medicare IRMAA surcharge, and the lost tax credits (like the earned income tax credit and premium tax credit) that can cost a retiree $5,000 to $15,000 per year. They use a concrete example: a 56-year-old FIRE couple in Oregon earning $28,000 from a consulting side hustle while living off a $600,000 portfolio. The episode drills into the 'tax torpedo' — the 50-85% marginal rate on Social Security benefits when combined with side-hustle income — and offers a practical workaround: timing side-hustle income to alternate years to preserve subsidy eligibility. No ads; listener-supported at buy me a coffee dot com slash fexingo. #FIRE #FinancialIndependence #EarlyRetirement #SideHustle #TaxTorpedo #SocialSecurity #IRMAA #Medicare #TaxPlanning #PassiveIncome #Consulting #RetireEarly #FrugalLiving #PersonalFinance #Finance #FexingoBusiness #BusinessPodcast #TaxTrap Keep every episode free: buymeacoffee.com/fexingo