Overview

• Fixed thresholds from the 1980s and 1990s still determine taxability, contributing to bracket creep that now leaves nearly half of beneficiaries paying federal tax on some benefits.
• The One Big Beautiful Bill grants a $6,000 deduction per filer aged 65 and older ($12,000 for couples) for tax years 2025–2028, phasing out above roughly $75,000 for single filers and $150,000 for joint filers.
• The new deduction is not above the line, so it does not reduce AGI or MAGI; the longstanding combined-income thresholds of $25,000/$32,000 and $34,000/$44,000 still govern how much of Social Security is taxable.
• The White House says the change will lift the share of seniors owing no federal tax on benefits to about 88 percent, while policy analysts criticize the 'no tax' message and note many low‑income seniors were already exempt.
• Experts warn the revenue loss could modestly hasten projected trust‑fund depletion in the early 2030s, and eligible taxpayers will first claim the new deduction when filing 2025 returns in 2026.