What to know about the $6,000 ‘senior deduction

Knight

Knight

Well-known Member
The Senate’s version of the “big, beautiful bill,” which passed Tuesday, includes a $6,000 tax deduction for Americans 65 or older.

The provision does not entirely end taxes on Social Security, but it would zero out the Social Security tax burden for 88 percent of seniors, according to an estimate by President Trump’s Council of Economic Advisers.

That’s up from 64 percent of seniors who are currently exempt from Social Security taxes, meaning about 14 million additional seniors will benefit from the change.

The version of Trump’s megabill that squeezed through the Senate would offer a tax deduction of $6,000 to seniors making up to $75,000 individually, or $150,000 on a joint return. The deduction is lowered for incomes above that level, and phased out altogether for seniors with individual incomes of more than $175,000, or $250,000 jointly.

What to know about the $6,000 ‘senior deduction’ in GOP megabill

I guess I won't know the impact until I file our taxes.
 

Nathan said:
Is that 'senior deduction' going to replace the Standard Deduction, or be an additional deduction?
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From the article that is to be additional to the standard deduction & the standard is to have a few hundred more added in.
 

Here’s what Ai has to say:
Yes, the new
$6,000 "senior bonus" deduction is in addition to the standard elderly standard deduction that people over 65 already receive.
Here's a breakdown:
  • Existing Standard Deduction: Americans ages 65 and older can claim an extra standard deduction ($2,000 for a single filer, $1,600 per qualifying spouse in a couple) on top of the regular standard deduction available to all taxpayers.
  • New "Senior Bonus" Deduction: The new legislation, sometimes called the "One Big Beautiful Bill," introduces a temporary additional standard deduction for individuals aged 65 and over, which is set to last from 2025 through 2028. The amount of this deduction is $6,000 for eligible individuals.
  • Combined Benefit: This means that eligible seniors can claim both the standard elderly deduction and the new "senior bonus" deduction.
Important to note:
  • Income Limits: The new deduction has income limits; individuals earning up to $75,000 (or $150,000 for couples filing jointly) can claim the full $6,000, while the deduction phases out at higher incomes and is not available for those earning over $175,000 (or $250,000 for couples).
  • Temporary: This "senior bonus" deduction is temporary and is scheduled to end after the 2028 tax year.
  • Benefits: While it is not a direct elimination of taxes on Social Security, the bonus may help reduce taxes on those benefits for individuals whose income is below the phaseout thresholds.
  • Lower-Income Seniors: Seniors with lower incomes who already pay little or no federal income tax may not see a significant benefit from this deduction, as it reduces taxable income rather than directly lowering the tax owed.
 
I'm not a socialist, but it doesn't seem right higher income levels have to pay a bigger tax percentage. Throughout my life I have worn both shoes, lower income and higher. While I believe income tax is squandered by a bloated and corrupt government, if we have to pay it shouldn't that be an equal flat rate for everyone?
 
Yeah, it sounds like a good deal, but why only thru 2028? Most seniors aren't going to suddenly become rich after 2028. I don't understand why you give a tax break for a few years then take it away. It just sounds like it's throwing a crumb to seniors because they promoted no tax on social security then reneged on that.
 
Tom52 said:
Yeah, it sounds like a good deal, but why only thru 2028? Most seniors aren't going to suddenly become rich after 2028. I don't understand why you give a tax break for a few years then take it away. It just sounds like it's throwing a crumb to seniors because they promoted no tax on social security then reneged on that.
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Take the win! 😉🤭😂

It was the same with the sunset provision in the middle class tax cuts, once politicians allow a benefit they know it’s a form of political suicide to let them expire.
 
Michael Z said:
If I understand this correctly, the amount of taxable income from your SS will be $6000 less, assuming you qualify fully?
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yes and if a couple 12k .

my damn rmds of 80k will bring me up to the cut off point for us getting the whole amount but at least we will see some of it .

now having rmds can be very costly if they bump your income to high
 
Tom52 said:
Yeah, it sounds like a good deal, but why only thru 2028?
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I see it as a foot in the door to keep said party in charge.... The other party would reverse it anyway just because this party thought it was a good idea.

We currently pay tax on 85% of my SS and all my pension. Will be nice to save a few $ over the next few years.
 
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mathjak107 said:
yes and if a couple 12k .

my damn rmds of 80k will bring me up to the cut off point for us getting the whole amount but at least we will see some of it .

now having rmds can be very costly if they bump your income to high
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If my not yet started rmds were gonna be 80k i wouldn’t give that piddling $6,000 a second thought 🤣😂🤣
 
Lizzie00 said:
Here’s what Ai has to say:
Yes, the new
$6,000 "senior bonus" deduction is in addition to the standard elderly standard deduction that people over 65 already receive.
Here's a breakdown:
  • Existing Standard Deduction: Americans ages 65 and older can claim an extra standard deduction ($2,000 for a single filer, $1,600 per qualifying spouse in a couple) on top of the regular standard deduction available to all taxpayers.
  • New "Senior Bonus" Deduction: The new legislation, sometimes called the "One Big Beautiful Bill," introduces a temporary additional standard deduction for individuals aged 65 and over, which is set to last from 2025 through 2028. The amount of this deduction is $6,000 for eligible individuals.
  • Combined Benefit: This means that eligible seniors can claim both the standard elderly deduction and the new "senior bonus" deduction.
Important to note:
  • Income Limits: The new deduction has income limits; individuals earning up to $75,000 (or $150,000 for couples filing jointly) can claim the full $6,000, while the deduction phases out at higher incomes and is not available for those earning over $175,000 (or $250,000 for couples).
  • Temporary: This "senior bonus" deduction is temporary and is scheduled to end after the 2028 tax year.
  • Benefits: While it is not a direct elimination of taxes on Social Security, the bonus may help reduce taxes on those benefits for individuals whose income is below the phaseout thresholds.
  • Lower-Income Seniors: Seniors with lower incomes who already pay little or no federal income tax may not see a significant benefit from this deduction, as it reduces taxable income rather than directly lowering the tax owed.
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Additionally, the standard deduction for MFJ was raised slightly from $30,000 to $31,500 This change was not exclusive to seniors.
 
Last year the taxes on our social security came to almost $3, 000. This year it will go up because the formula for calculating the amount taxable is not indexed to inflation. The $12,000 additional deduction that my wife and I will get will reduce that by $1,440 as we will be in the 12% bracket. So I figure we will still be paying between $1,500 and $2,000 of taxes on our social security.

I expect the $1440 of so called tax relief will be offset by inflation due to all the new tariffs and the additional cost of replacing the cheap labor that will be lost due to all the deportations. I call it "so called" tax relief because it does not consider the fact that tariffs are also a tax that is ultimately paid by the consumers in the form of higher prices.
 
Trade said:
Last year the taxes on our social security came to almost $3, 000. This year it will go up because the formula for calculating the amount taxable is not indexed to inflation. The $12,000 additional deduction that my wife and I will get will reduce that by $1,440 as we will be in the 12% bracket. So I figure we will still be paying between $1,500 and $2,000 of taxes on our social security.

I expect the $1440 of so called tax relief will be offset by inflation due to all the new tariffs and the additional cost of replacing the cheap labor that will be lost due to all the deportations. I call it "so called" tax relief because it does not consider the fact that tariffs are also a tax that is ultimately paid by the consumers in the form of higher prices.
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I hear ya but I’ll take it! 😉🤭😂
 
mathjak107 said:
well i do and it aint piddling .

dont forget it can cost 2x what it cost to buy the same life style in new york as other places. .

we have higher incomes and considerably higher costs
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Ah c’mon i was just tossing out an (apparently non-humorous) attaboy for that healthy rmd you mentioned…i speak in Southernese😉

But moving right along for anybody who might be unaware…you can toss your personal numbers out to ChatGPT & it’ll quickly give you a good idea of what that extra $6,000 will mean for YOU…it’ll also explain the finer details of how it all works if you ask.
 
mathjak107 said:
it’s crazy that the wealthy are going to see all kinds of tax breaks but someone over 75k won’t get the whole exclusion
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Exactly MJ !
Also I want to know will this take affect with the 2025 tax return? And since it's touted as an addition $6,000 why does it only add a few hundred dollars to the deduction? Seems like smoke and mirrors to me.
 

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