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2h ago

New Senior Deduction Leaves Social Security Tax Rules Intact for 2025–2028

Analysts say the temporary $6,000 benefit reduces many seniors’ taxable income without altering the decades‑old thresholds that determine whether benefits are taxed.

U.S. President Donald Trump speaks during an event at the Kennedy Center on August 13, 2025 in Washington, DC.
Close-up of a finger touching a loading bar transitioning from 2025 to 2026, representing vision, innovation, and the future. Ideal for illustrating technological progress and forward-thinking concept
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Overview

  • The One Big Beautiful Bill created an extra $6,000 deduction for taxpayers 65 and older ($12,000 for joint filers) starting with 2025 returns and running through 2028.
  • The deduction phases out above modified AGI of $75,000 for single filers and $150,000 for joint filers, and it disappears entirely by $175,000 and $250,000 respectively.
  • The new write‑off is not above the line, so it does not reduce AGI or MAGI used in the combined‑income formula that can make up to 85% of Social Security benefits taxable.
  • Long‑frozen combined‑income thresholds of $25,000/$32,000 and $34,000/$44,000 remain in place, a setup that has drawn scrutiny for pulling more retirees into taxable status over time.
  • The White House estimates about 88% of beneficiaries will owe no federal income tax on their benefits under the new rules, as budget experts caution the change modestly worsens trust‑fund solvency projected to face shortfalls in the mid‑2030s.