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“No tax on Social Security:” Here’s the real story - Thomson Reuters
Be careful of campaign promises and political spin – they don’t all happen, and sometimes they may actually happen, but take an unusual and different approach. Such is the case with the bold assertion by the Administration that “income tax on Social Security has been mostly eliminated.” It likely has been mitigated for most SS recipients, but not by changing how benefits are actually treated by the IRS. Rather, the legislation which “fulfilled” the political promise provided an extra IRS deduction for those over age 65 (often on Social Security). In fact, the IRS will still levy income tax on Social Security benefits for those whose income is high enough, but the so-called “one big, beautiful bill” passed earlier this year also provided a $6000 per person additional tax deduction meant to offset any SS income tax paid. Thus the assertion is technically accurate, but not in the way most expected. And the reason has to do with Congressional rules for changing Social Security law. Nevertheless, America’s seniors 65 or over stand to gain substantial tax relief (at least until 2028) on Social Security benefits, as told in this Thomson Reuters article by Mary Lundstedt.
Also, if you’re unsure about how these basics apply to you, or if you have any questions about your individual situation under Social Security, note that the AMAC Foundation provides a free-to-the-public advisory service to help Americans navigate the complexities of this program. All questions are answered quickly, at no charge. Learn more about it here…