Overview

• Congress passed the Big Beautiful Bill on July 3, replacing President Trump’s vow to wipe out Social Security taxes with a limited deduction for seniors.
• The law grants up to $6,000 in deductions for individual filers and $12,000 for married couples aged 65 or older with adjusted gross incomes under $75,000 or $150,000.
• The deduction is temporary, covering tax years 2025 through 2028, and excludes both low-income beneficiaries who already owe no taxes and retirees above the phase-out thresholds.
• Analysts from the Committee for a Responsible Federal Budget and other nonpartisan groups warn the measure will accelerate depletion of the Social Security and Medicare trust funds, advancing insolvency to 2032.
• White House officials argue the deduction will extend tax relief to about 88% of seniors who pay taxes on their benefits, calling it a major senior tax cut.