What happened to President Trump Eliminating Taxes on Social Security? - MSN.com
Following its passage in the Senate, H.R. 1 (the “One Big Beautiful Bill Act”)provides a larger standard deduction for seniors 65 and older. According to a post on whitehouse.gov, it is estimated that the “bonus” deduction will result in 88% of seniors no longer paying federal income tax on their Social Security benefits, compared to the 64% that currently do. To view the estimated breakdown released by the White House, click here …
Currently, Social Security recipients pay taxes on up to 85% of their Social Security benefits, and the number of recipients that are taxed grows every year as taxable income grows. This is the result of the threshold for income taxation remaining fixed since 1983. For single individuals, the limit is $25,000 to $34,000, and for married individuals, the limit is $32,000 to $44,000, and this includes 50% of the filer’s Social Security benefit. Exceeding these limits results in up to 85% of your benefits being taxable. These limits are based on your Modified Adjusted Gross Income (MAGI), defined as AGI plus 50% of your Social Security benefits plus non-taxable interest.
The bill was passed in the Senate through the “reconciliation process,” which prevents making major changes to the Social Security Act, such as eliminating the taxation of Social Security benefits. The Bill passed in the Senate yesterday by a vote of 51-50, with Vice-President J.D. Vance breaking the tie. However, since changes were made to the House of Representatives version, approval of the modifications by the House is required. House-directed changes could occur before it goes to the President’s desk for signature. To read the entire article by Aliss Higham on MSN.com, click here…
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