Statistically, President Donald Trump's "Big, Beautiful Bill" Makes Social Security Worse

Key Points

• Most aging workers rely on their Social Security to cover at least some portion of their expenses.

• The program is facing an estimated $25.1 trillion long-term funding deficit and the prospect of sweeping cuts for retirees and survivor beneficiaries by 2033.

• Temporary and permanent tax changes made by Trump's bill will adversely affect Social Security's No. 1 source of income.

• The $23,760 Social Security bonus most retirees completely overlook ›

In May, the average Social Security retired-worker check crested $2,000 for the first time in the program's storied history. While $2,000 per month might not sound like a lot, this guaranteed monthly benefit has proved vital to helping aging workers make ends meet.

If Social Security didn't exist, the poverty rate for adults age 65 and over would nearly quadruple from 10.1% in 2023 to an estimated 37.3%, based on an analysis from the nonpartisan Center on Budget and Policy Priorities. Meanwhile, 24 consecutive years of national pollster Gallup's surveys of retirees have shown that 80% to 90% of respondents say they rely on their monthly check, in some capacity, to cover their expenses.

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President Trump. Image source: Official White House Photo by Andrea Hanks.

Ideally, ensuring the long-term financial health of Social Security should be of paramount importance for our elected officials, who include President Donald Trump.

However, a detailed analysis of Trump's flagship tax and spending law, the "big, beautiful bill," shows it statistically worsens the financial outlook for America's leading retirement program.

Social Security benefit cuts are less than a decade away

For more than eight decades, the Social Security Board of Trustees has released a report annually that outlines the financial health of the program. It examines how every dollar in income is collected, tracks where every dollar in outlays ends up, and projects the program's long-term solvency by looking 75 years into the future following the release of a report.

For 40 years, the Trustees have warned that Social Security was contending with an unfunded obligation over the long term. In short, estimated income to be collected over 75 years is expected to be insufficient to cover benefits and the relatively minimal cost to operate the program. As of the 2025 Trustees Report, this 75-year cash deficit had ballooned to $25.1 trillion.

What's even more worrisome is the projected fate of the asset reserves of the Old-Age and Survivors Insurance trust fund (OASI). This is the fund responsible for paying benefits to retired workers and survivors of deceased workers each month.

The latest forecast calls for the OASI's cash outflow to accelerate in the coming years. As outlays for benefits grow at a considerably faster pace than income collected, its asset reserves will dwindle. By 2033, it's expected to be completely exhausted, which can lead to sweeping benefit cuts for retired workers and survivor beneficiaries of up to 23%

The OASI's asset reserves are projected to be gone in eight years. US Old-Age and Survivors Insurance Trust Fund Assets at End of Year data by YCharts.

To be abundantly clear, the OASI doesn't require a cent in its asset reserves to continue making payments to eligible beneficiaries. The 12.4% payroll tax on earned income from $0.01 to $176,100 (as of 2025) accounts for the bulk of the income Social Security collects. As long as people keep working and paying this tax, the program will always have money to dispense.

In other words, there's no danger of the OASI going bankrupt or becoming insolvent. Rather, the risk is to sustaining the existing payout schedule, including annual cost-of-living adjustments (COLAs).

Statistically speaking, Trump's flagship tax and spending law widens this funding deficit

Prior to Trump's November election, and in the months after taking office for his second term, the president had pledged to do away with the much-disliked taxation of Social Security benefits.

However, there were logistical issues that would need to be overcome to remove the tax on benefits. Specifically, amending the Social Security Act would require 60 votes in the upper house of Congress.

Even though Republicans currently control both houses of Congress, they would need seven senators outside of their party to reach 60 votes, which is highly unlikely. Rather than risk an embarrassing defeat of the big, beautiful bill in the Senate, or hold it up, this exceptionally popular proposal to shelve the tax on Social Security benefits was entirely left out.

However, this doesn't mean Trump's flagship law won't affect Social Security.

Roughly a month ago, Sen. Ron Wyden of Oregon, the highest-ranking Democrat on the Senate Finance Committee, sent a request to the Social Security Administration's Office of the Actuary (OACT) to estimate the financial impact of the big, beautiful bill on Social Security. The 10-year forecast provided by the OACT points to an even wider funding deficit for the program.

Image source: Getty Images.

Though there are no direct provisions altering the Social Security Act in the big, beautiful bill, there are a number of changes (some temporary) that will adversely affect payroll tax collection, which accounted for more than 91% of the income Social Security brought in last year. Some of these changes include:

• Making the personal income tax brackets and reduced rates from the Tax Cuts and Jobs Act permanent.
• Temporarily increasing the standard deduction by $6,000 (or $12,000 for couples filing jointly) for eligible seniors age 65 and over from tax year 2025 through 2028.
• Temporarily providing eligible workers a partial deduction on their overtime pay -- the maximum annual deduction is $12,500, or $25,000 for joint filers -- from tax year 2025 through 2028.
• Temporarily providing eligible workers with the ability to deduct up to $25,000 in annual tips from tax year 2025 through 2028.

Based on new projections from the OACT, this confluence of tax changes will increase costs for the combined OASI and Disability Insurance trust fund by an estimated $168.6 billion from calendar year 2025 through 2034. While $168.6 billion is a veritable drop in the bucket when compared to a $25.1 trillion (and growing) long-term funding deficit, it undeniably points to Trump's tax and spending law making Social Security's situation worse.

Furthermore, the OACT foresees the OASI's asset reserve depletion date being pushed forward from the first quarter of 2033 to the fourth quarter of 2032.

Although Social Security is in no danger of halting benefits or disappearing, Trump's big, beautiful bill has made fixing this premier retirement program even more difficult.

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