In July 2025, President Donald Trump signed the One Big Beautiful Bill Act (OBBBA), introducing a new tax break for seniors. “Taxpayers who are 65 or older by the end of the tax year may claim an extra $6,000 deduction.” Married couples can claim up to $12,000. This deduction is separate from the standard deduction and applies whether seniors itemize or not.
The deduction has income limits. Singles with a modified adjusted gross income (MAGI) of $75,000 or less get the full $6,000; married couples filing jointly with MAGI up to $150,000 get $12,000. The benefit gradually phases out at higher incomes, disappearing above $175,000 for singles and $250,000 for couples.
The OBBBA does not repeal Social Security taxes. However, “because it significantly reduces taxable income, the deduction may result in many older taxpayers having little or no taxable income left,” lowering or eliminating federal taxes on benefits for many retirees. Estimates suggest “upward of 88%” of seniors could pay little or no tax on Social Security.
The deduction mainly benefits low- to moderate-income retirees. It helps cover living expenses such as groceries, medical care, and housing. Higher-income seniors may see limited or no benefit due to phase-outs.
The OBBBA also raised the standard deduction for all taxpayers, adjusted bracket thresholds, and added temporary deductions for certain income types. Taxpayers should consult IRS guidance or professionals to apply these rules accurately.
