Good citizens understand that taxes are necessary for the functioning of an effective civil government. But nobody enjoys paying them. Most taxpayers work to minimize their annual income tax bill, in fact, perhaps hoping for a time they won't have to pay any taxes at all.

The thing is, if you made enough money during your working years to regularly pay income tax on your wages, there's a good chance you'll be earning enough money in retirement to continue paying them. Even a portion of your Social Security benefits are automatically included in the IRS's calculation of your taxable retirement income.

Here's a rundown of the top three things current and future Social Security beneficiaries need to know about the potential taxes they'll owe once they've begun accepting benefits.

1. A portion of it could be federally taxable

It's true. At least some of your Social Security income is subject to taxation. Fortunately, not all of it is, and many retired Social Security recipients end up not paying any income tax at all.

The brackets are simple enough. The first step is combined income, which is generally the sum of adjusted gross income plus tax-exempt interest income and one-half of your Social Security benefits for the year. For individual filers already collecting Social Security checks, combined income below $25,000 doesn't leave any Social Security benefits subject to taxation. For combined income between $25,000 and $34,000 per year, up to 50% of your Social Security benefits can get treated as taxable income. And if combined income is above $34,000, up to 85% of a single filer's Social Security income can get treated like taxable income.

But you're a joint filer? That raises the bracket thresholds to $32,000 and $44,000 respectively.

Just to stave off any confusion, the IRS doesn't tax the entirety of retirement income in question at a rate of 50% or 85%. Only 50% or 85% of your total Social Security benefits are subject to taxation at the more familiar tax bracket rates. These range from 10% to 37%, depending on your total taxable income for the year in question.

Still, the fact that all Social Security income isn't inherently completely tax-free comes as a shock to some.

2. Other sources of income are added to the total in question

Although not all of your Social Security is potentially taxable, do understand that the threshold amounts discussed above include retirement income from sources other than Social Security. So the more income you have beyond Social Security, the more likely it is that a portion of your benefits could get taxed.

If you also receive a pension check or dividend income, realize capital gains, withdraw money from a traditional IRA or 401(k), or earn work-based wages after claiming benefits, those are added to your Social Security income, which could push your yearly income above the $25,000 or $34,000 thresholds (or $32,000 and $44,000, if you're filing jointly). And 100% of that non-Social Security income is still treated like ordinary taxable income, even if all of your Social Security payments aren't.

The good news is, all other taxpayer benefits -- like credit for charitable donations, standard deductions, and the progressive/tiered tax brackets -- still apply. Even people with retirement incomes above these thresholds might not have to fork over a massive chunk of their retirement income to the IRS.

3. Your state might tax it too

Finally, while a handful of people collecting relatively large Social Security checks in retirement may end up giving a portion of that money back to the federal government -- in the form of income tax payments -- a few people may be passing along a bit of their benefits to their state tax collectors as well.

As it stands right now, 12 states may consider at least a portion of Social Security benefits to be taxable income for the purposes of calculating their taxpayers' state-based income tax bills. These states are Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, Vermont, and West Virginia. The other 38 (and Washington, D.C.) don't.

That being said, every state's tax laws vary somewhat, so it's still possible you could sidestep most if not all of any tax liability on your Social Security retirement income.

Planning is the key

Feeling better? Maybe worse? If this revelation has you feeling much of anything, it shouldn't. This prospective taxation doesn't actually alter most people's standard of living in retirement much for the worse, if at all.

Either way, Social Security will ideally only be a minor portion of your retirement funding plans anyway. You may well generate even more retirement income just by steadily saving and investing while you're working, even if you're getting a bit of a late start in life.

If you need help piecing together such a plan, the first steps should include figuring out how much total retirement income you'll need, and making a savings plan that you can stick with that will get you there.