When President Trump signed the “big, beautiful bill” into law, headlines claimed it would eliminate federal income taxes on Social Security benefits. But does it really?
Here’s what’s actually happening:
The bill creates a $6,000 temporary tax deduction for seniors 65+, doubling to $12,000 for couples. It applies to total income, not just Social Security — and only if you earn under $75,000 (or $150,000 for joint filers).
But this isn’t a repeal of Social Security taxes. The taxation rules for Social Security haven’t changed. Policy experts warn the deduction is modest, and many low-income seniors already pay no tax, meaning they see little or no benefit.
Who actually benefits?
Higher-income seniors will gain the most. According to the Tax Foundation, the wealthiest retirees will receive the largest tax breaks, while lower earners — who already fall below the taxable threshold — get little or nothing.
And there’s another problem:
This deduction could hurt the long-term stability of Social Security. Experts like Bobby Kogan at the Center for American Progress warn the change will reduce revenue going into the Social Security Trust Fund — already projected to run dry by 2034.
According to the Penn Wharton Budget Model, eliminating Social Security taxes entirely (as some headlines suggested) would increase the national debt by $1.5 trillion over 10 years.
Bottom line:
This is not a repeal — it’s a deduction. For most seniors, the tax system on Social Security remains the same. And for many who don’t meet the income threshold, the deduction won’t change their bottom line.
Summary:
$6,000 senior deduction (expires 2028)
Only benefits seniors earning under $75K
Doesn’t eliminate Social Security taxes
May weaken long-term Social Security funding
Don’t fall for the headline — here’s the real breakdown of what passed, who qualifies, and what it means for the program’s future.