Overview
- The OBBB created a temporary deduction of up to $6,000 per filer age 65 or older for tax years 2025 through 2028, with eligible married couples able to claim up to $12,000 whether they itemize or take the standard deduction.
- The benefit begins to phase out above MAGI of $75,000 for single filers and $150,000 for joint filers, and it is fully phased out by $175,000 and $250,000, respectively.
- White House estimates say roughly 33.9 million seniors will benefit with an average after-tax gain of about $670, while analyses find little or no benefit for the lowest-income seniors and limited gains for the highest earners.
- Because it is a below-the-line deduction, it reduces taxable income without lowering AGI, so it does not change Social Security benefit taxation or Medicare IRMAA; taxpayers must claim it on the new Schedule 1‑A to Form 1040.
- The Committee for a Responsible Federal Budget estimates the change will cut roughly $30 billion a year from taxes credited to Social Security’s trust fund, and the CBO projects the main fund will be exhausted in 2032 absent action, risking across-the-board benefit reductions.