Summary
President Donald Trump signed a bill that introduces a new tax deduction for Social Security beneficiaries starting in 2025. This deduction helps seniors aged 65 and over with a smaller tax bill if they meet certain income limits. The deduction lasts until 2028 and aims to provide temporary tax relief.
Key Facts
- The new deduction is $6,000 for single seniors earning up to $75,000 annually.
- Married couples can claim a $12,000 deduction if they earn up to $150,000 together.
- The changes take effect for the 2025 tax year and end in 2028.
- Seniors must be at least 65 years old and meet the income requirements to qualify.
- This deduction is in addition to the standard deduction, which has also increased due to inflation adjustments.
- It doesn't eliminate taxes on Social Security benefits but reduces overall taxable income.
- Experts note that the deduction is temporary and could shift financial burdens to future generations.
- The ongoing concern is about the strain on the Social Security trust fund as benefits increase and tax revenues decrease.
