What's the Truth About Taxes on Social Security Benefits?

When campaigning for president, Donald Trump pledged that he would eliminate taxes on Social Security. The White House has declared victory on this issue, with a press release in July indicating that "No Tax on Social Security is a Reality in the One Big Beautiful Bill."

But is that the case? Did taxes on Social Security benefits really disappear, or is there more to the story?

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Did tax on Social Security benefits go away?

The first and most important thing that you need to know is that taxes on Social Security benefits have not disappeared. In fact, the rules remain entirely unchanged.

Under the current rules, your provisional income determines whether you are taxed on your Social Security benefits. Provisional income is half of your Social Security benefit, plus certain other non-taxable income like MUNI bonds, plus all taxable income. If your provisional income is:

• Above $25,000 as a single tax filer or above $32,000 as a married joint filer, you will be taxed on up to 50% of your benefits
• Above $34,000 as a single tax filer or above $44,000 as a married joint filer, you will be taxed on up to 85% of your benefits

This was the rule before the Big, Beautiful Bill, and it remains the rule after the tax changes made in the Big, Beautiful Bill. Once you hit these thresholds, you would be required to pay federal income tax on a portion of your benefits.

Individual states that tax Social Security also set their own rules, and only a small minority of states tax Social Security. The Big, Beautiful Bill did not make any changes to state-level rules on Social Security tax.

This does not mean the BBB didn't change anything, though. Instead, it created a new tax deduction for seniors. In the 2025 to 2028 tax years, individuals 65 and over are allowed to claim an additional $6,000 deduction per individual or $12,000 total per married couple. The deduction phases out once you have a modified adjusted gross income of $75,000 as a single filer or $150,000 as a married joint filer, but if you are below these thresholds, you'll add the extra $6,000 or $12,000 to your existing standard deduction.

With the new deduction, taxable income goes down. House Ways and Means Committee Chairman Jason Smith has explained that this will result in no taxation of benefits for around 90% of seniors.

Do you have to be on Social Security to claim the new deduction?

It's worth noting that because this new tax deduction is not specifically tied to Social Security benefits in any way, you do not have to be collecting Social Security in order to qualify to claim it. This means that any senior who meets the income requirements can benefit from the tax savings, even if they don't have retirement benefits coming in, and even if they are not yet retired.

Since the tax deduction is available to all seniors, in a way, it provides broader tax relief than just eliminating taxes on Social Security, since anyone 65 and over can claim it.

Deductions reduce your taxable income, rather than providing a dollar-for-dollar reduction on your tax bill, as a credit would do. If you previously had $60,000 in taxable income as a married couple after claiming all your other deductions, and you both claim this $6,000, you'll reduce the $60,000 down further to just $48,000.

The savings from deductions will be determined by your tax bracket, so you'll need to look at your taxable income to see how this affects you. Still, while your bill is going to be smaller, the tax relief is temporary, and the rules for taxation on Social Security remain the same. So you could still find yourself owing the IRS a cut of your benefits -- especially after 2028, if the extra $6,000 deduction isn't extended.

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