Posted on 07/04/2025 3:34:48 AM PDT by zeestephen
Just received this email from SocSec - This is NOT posted on the SocSec website - "BBB provides an enhanced deduction for taxpayers aged 65 and older..."
"You will pay federal income taxes on your benefits if your combined income (50% of your benefit amount plus any other earned income) exceeds $25,000/year filing individually or $32,000/year filing jointly."
I got the email also, just after midnight, I think.
I am sure they have not had time to update the website. It was too late to do so after passage.
Anyway, yay!
I received it last night. There were no specifics.
It’s only temporary. The deduction goes away Jan 1, 2029. Same with taxes on tips and overtime.
I am 74 and working. Doesn’t always pay to be a 10%-er.
So your numbers mean nothing.
If they are the old numbers.
I got that too. I guess everyone on SS got one.
“It’s only temporary. The deduction goes away Jan 1, 2029”
If it isn’t extended
Very interesting.
Thanks for hipping us (or, at least, This Guy!).
Can you imagine taxation of tips and overtime being allowed to return?
It will be interesting to see how the elimination of taxes on tips, and the elimination of tips on overtime, will be implemented in terms of the tax forms and associated instructions provided by the IRS.
Will such income still be required to be reported? Even though it will not be taxed.
It’s easy to imagine that the IRS will wish to “keep tabs” on such untaxed income being earned by the huddled masses, yearning to earn free.
Also, and maybe this is a dumb question, but will such income be subject to payroll taxes, even if not subject to income taxes?
I did not.
Just until 2028, right?
From website it seems to say there are two changes but I only know about the $6k over 65 deduction.
“The new law includes a provision that eliminates federal income taxes on Social Security benefits for most beneficiaries, providing relief to individuals and couples. Additionally, it provides an enhanced deduction for taxpayers aged 65 and older, ensuring that retirees can keep more of what they have earned.”
Also, I am hard pressed to see how they determine the 90% number. $6k is far less than the average benefit and lots of seniors begin at 62.
Imagine the outcry if Congress doesn’t extend it.
The best that I can figure out is the following:
1. People over 65 get an additional $6,000 tax deduction (on top of existing deductions), independent of Social Security. Married couples, $12K, if both over 65 (I think).
2. It starts to go away at $75k ($150k if married) total income, including Social Security. It’s phased out completely at $175k/$250k. These levels are based on AGI (for you CPAs out there).
3. This starts this year (tax year 2025) and goes on for 4 years, through 2028 - in other words, Trump’s term in the White House.
And this is from the Republicans? They treat their older voters the same way Democrats treat blacks; just enough to vote for them again.
I’m trying to figure out if this is saying “The first $32k for married people of income is not taxed”.
The “bonus” added to the standard deduction, as I understand it, was enacted in the 2017 tax legislation, and applied to seniors 65 and older. It made no difference if the individual received SS benefits earlier. I don’t believe the 65 breakpoint changed in the BBB. The 90% number is just a guess at this point anyway.
What’s important is that the “bonus” would have totally gone away if the BBB was never passed and signed into law.
I will be watching the signing ceremony this morning with a big grin on my face!
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