by The legislative form of President Donald Trump’s 2024 campaign promise to eliminate taxes on Social Security benefits, a proposed $6,000 deduction for seniors, is part of the tax measure that Senate Republicans approved on Tuesday.
One of the most striking features of the Trump tax bill is the new deduction, which the White House has been keen to promote as a significant economic boost for Americans 65 and older. However, according to neutral assessments, the measure would accelerate the period by which the Social Security trust fund runs out of money and would not help tens of millions of seniors with low incomes.
Although the GOP tax measure would marginally raise those levels, most people currently claim the standard deduction of $15,000 (or $30,000 for couples) to lower their tax liability. Furthermore, seniors are already eligible for an extra $2,000 deduction (or $3,600 for couples).
According to the Senate bill, seniors who fall below a specific income threshold would be eligible for a third category that would deduct an additional $6,000 (or $12,000) from their taxable income. The deduction would begin to decrease for seniors making above $75,000 ($150,000 for couples) annually, then gradually decrease and eventually vanish for those making over $175,000 ($250,000 for couples).
Seniors with lower incomes would also have fewer benefits because the majority do not owe enough taxes to qualify for the increased deduction. According to official data, the median income for seniors in 2022 was about $30,000, which is comparable to the current standard deduction. According to experts, the new Trump provision would not assist about half of Americans 65 and older, despite the fact that seniors’ median income has grown since 2022.
The Committee for a Responsible Federal Budget estimates that the proposal, which would not apply to retirement benefit claimants between the ages of 62 and 64, would cost roughly $90 billion over four years and nearly $250 billion if made permanent. The provision is one of the more costly individual elements in the legislation, even if it does not account for a significant portion of the total tax package.
It is unclear if the Senate’s $6,000 proposal or the House’s $4,000 senior deduction will be included in the final tax package.
According to Marc Goldwein, senior vice president of the nonpartisan Committee for a Responsible Federal Budget, this will be a significant tax decrease that will benefit seniors in the upper middle class. Despite the fact that it may be marketed to seniors with modest incomes, these individuals already pay taxes.
The White House has defended the plan against criticism, claiming it will carry out Trump’s campaign pledge to eliminate Social Security levies. Trump supported a number of similar measures during the 2024 election, such as banning tip taxes, which enraged conservative tax specialists but were intended to make tax reform more politically appealing.
According to a White House statement, the One Big Beautiful Bill offers seniors historic tax relief through a new tax deduction that, when paired with existing deductions, guarantees the average Social Security beneficiary will pay no taxes on Social Security.
Despite not directly affecting the program’s structure, the provision has also come under fire for worsening Social Security’s already poor financial future. This is because, under current law, Social Security benefits are partially taxable. The money collected from these taxes is then used to fund the program’s trust fund, which in turn distributes benefits. The new deduction would decrease the portion of Social Security benefits that are subject to taxation by lowering the amount of income that seniors owe taxes on, which would decrease the amount of money that goes into the trust funds.
The One Greatly Lovely The Committee for a Responsible Federal Budget claims that the bill, which Republicans have named the 2025 legislative package, would advance the Social Security trust fund’s expiration date from 2033 to 2032 by around one year. According to the committee, that year will also mark the 69th birthday of today’s youngest pensioners and the year that 60-year-olds will achieve the program’s full retirement age.
The savings for seniors who would be eligible for the deduction would differ greatly depending on their filing status and income. With the deduction, a couple over 65 making $100,000 could see a $12,000 decrease in their taxable income, but a single filer on $40,000 might only receive a few hundred dollars. Additionally, a large number of wealthy seniors would likely be eligible for the deduction due to their low six-figure yearly income.
The deduction would also apply to taxpayers who itemize their taxes.
According to Howard Gleckman, senior fellow at the nonpartisan Tax Policy Center, it is primarily for middle- and upper-middle-class individuals; wealthy people do not receive it, and it has no benefit for those with lower incomes, who already earn less than the standard deduction before the new senior bonus.
According to Gleckman, the deduction is still better than Trump’s initial plan to remove Social Security taxes, which he said would have benefited wealthy pensioners much more. According to calculations, that idea would have cost far more—possibly more than $1 trillion.
According to Gleckman, a sizable portion of senior citizens do not now pay taxes. It’s pretty excellent that this doesn’t cause any additional harm. However, it also does nothing to benefit those who are most in need of assistance.
