Newsom brands Trump a 'dictator' after National Guard deployed
California Governor Gavin Newsom accused US President Donald Trump of acting like a 'dictator' by sending the National Guard into Los Angeles to quell protests.
It marks the first time that federal troops have been deployed on domestic soil against the wishes of state authorities since the 1960s. Police officers clashed with crowds Sunday, the third day of protests sparked by border authorities' raids on suspected undocumented migrants.
Trump is testing the boundaries of executive power, the Financial Times' Washington correspondent wrote: He used a rarely invoked law originally written to suppress rebellions against the federal government to deploy the troops, with legal scholars arguing the moves are in breach of the US Constitution.
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A shadow Fed chief could lead to a ‘revolt' on the FOMC against Powell's successor, former vice chair warns
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New $4,000–$6,000 senior tax break proposed: Who qualifies and how much you'll save
Many taxpayers 65 and older seem to have a decent shot at ultimately seeing an extra federal income tax break of some flavor on their 2025 tax returns. Both the House version and the Senate version of President Donald Trump's sweeping tax cut and spending bill include a new senior "bonus" deduction that would be available for those age 65 and older whose income falls within set limits. We're talking about older adults of modest means seeing, perhaps, $480 to $720 in federal income tax savings, if some version of an enhanced deduction for seniors is approved. The taxpayer must turn 65 before the end of 2025 to qualify for the deduction on next year's tax return. It would not matter if you're receiving Social Security benefits or delaying claiming. Seniors with a high incomes would not qualify; lower income seniors who do not pay taxes would not benefit, either. Social Security benefits would continue to be taxed for many seniors. The president's campaign promise to end taxes on Social Security benefits is not included in either the Senate or House versions. One provision of the Congressional Budget Act of 1974, known as the Byrd Rule, prohibits Senate reconciliation bills from including any measure that changes Social Security benefits or taxes. Offering an enhanced tax break is another way to reduce taxes for many seniors, though. What kind of new tax break could seniors see? Significant differences exist between the House and Senate versions relating to the enhanced deduction for seniors. As a result, it's hard to know right now exactly how any new rule might land. Here are some points to consider: Size of the tax break: Under the Senate version, the maximum bonus deduction would be up to $6,000 for those 65 and older. Tax filers could claim this deduction on top of the standard deduction and extra deductions that already exist for seniors. The proposed bonus deduction would be smaller — only up to $4,000 for people 65 and over — under the House version. The House GOP mega-bill passed May 22 by a single-vote margin. At a 12% marginal tax rate, the $4,000 deduction alone for a single taxpayer who is 65 or older would result in $480 in tax savings, according to Garrett Watson, director of policy analysis at the nonpartisan Tax Foundation. That savings would be $720 if you could take a $6,000 deduction under the Senate version in this example, assuming a taxpayer with a 12% rate. Savings would vary based on the tax rate. For a single taxpayer, the 12% tax rate applied on taxable income from $11,926 through $48,475 in 2025. Annual inflation adjustments can be made to marginal tax brackets. Right now, taxpayers 65 and older already qualify for an additional standard deduction, which reduces taxable income, on top of the regular standard deduction, if they do not itemize deductions, such as mortgage interest or medical expenses. New 401(k) contribution limits: What Gen X and Baby Boomers need to know in 2025 On 2025 federal income tax returns, the additional standard deduction for seniors is $2,000 if you are single or file as head of household and not a surviving spouse. The amount is $1,600 per qualifying individual if you're married, filing jointly or separately. The "senior bonus" would apply whether you itemized or claimed the standard deduction and it would be on top of those deductions. Who qualifies based on income limits: The Senate version is far more restrictive when it comes to cutting off seniors with higher incomes from any additional tax break. Under both the House and Senate bill, taxpayers 65 and older could receive the full deduction if their modified adjusted gross income is no more than $75,000 for single filers and no more than $150,000 for married filing jointly. Under the Senate version, the deduction would phase out more quickly, meaning you'd qualify for less of a tax break or not get any break, once thresholds are hit. The "senior bonus" under the House version phases out at 4% starting at each dollar above $75,000 for singles and $150,000 for joint filers, according to Howard Gleckman, a senior fellow at the Urban-Brookings Tax Policy Center. The Senate Finance bill phases out more quickly at 6%. What's the phase-out limit?: As incomes go above those thresholds, the deduction would be smaller until it phases out completely for an individual with $175,000 in modified adjusted gross income or a married couple filing a joint return with $250,000. That's true with both bills. How long will this tax break last?: Both the House and Senate bills put a limit on the new "senior bonus." We're looking at a proposed tax break that remain in place in 2025, 2026, 2027 and 2028. Odds seem good that many seniors will see tax break "Some version is likely to make it into the final bill," said Mark Luscombe, principal analyst for Wolters Kluwer Tax & Accounting in Riverwoods, Illinois. "Many seniors already pay no income tax, and, unlike a refundable credit, this deduction would not benefit them," Luscombe said. "It is not overall as generous as Trump's original proposal to not tax Social Security benefits; however, it targets the bonus more toward low- and middle-income seniors rather than wealthier seniors," he said. Luscombe said the Senate may have come up with the higher bonus in order to appear to come closer to meeting Trump's initial proposal to not tax Social Security benefits. "Addressing changes to Social Security benefits directly may have been difficult to do under the Senate budget reconciliation rules, so this appears to be an effort to honor Trump's proposal in a manner that works under the budget reconciliation rules," Luscombe said. It's up for debate as to which version — House or Senate — ultimately prevails. Or even if there is some compromise figure or restrictions that are reached. Luscombe said much will probably depend primarily on the overall budget numbers and how the provision might be paid for with revenue offsets or spending cuts or whether it adds to the projected deficit. Again, not all seniors will benefit from this new bonus tax break. "Keep in mind that lower-income seniors would get no benefit since they already make less than the current standard deduction," Gleckman said. Lower-income households that do not have taxable income would not benefit, experts said, as they do not have income to offset. "And, due to the phase-out, very few high-income older adults would get a benefit," Gleckman said. Gleckman said the House and Senate versions primarily benefit middle- and upper-middle income seniors only. The Tax Foundation estimates that the $4,000 deduction for seniors would cost about $22.8 billion in 2025 and $23.2 billion in 2026 in federal revenue. The Tax Foundation estimates that the Senate version at a maximum $6,000 deduction would cost about $35 billion annually, which is about $12 billion larger than the House version or about 52% more. Gleckman, at the Urban-Brookings Tax Policy Center, said it would make sense that the Senate version could be more costly, but he did not have a specific estimate on June 23. "Yes, the phase-out is faster," Gleckman said. "But there are far more middle-income older adults than very high-income seniors. So many people getting $6,000 is more costly than a somewhat higher number getting $4,000." How can you plan if you're a senior to take advantage of this potential tax break? Gleckman said planning tips would be limited because it's unknown what the rules will look like should some version pass Congress and be signed into law by Trump. We've already gone through half of the year, as well. In general, he said, a senior with investments could try to defer capital gains or delay withdrawals from retirement accounts if they're able to do so. You'd need to be closer to 65 than your 70s so that you're not subject to required minimum distributions to be able to delay withdrawing money from a 401(k) or other retirement savings account. Required minimum distributions are the minimum amounts you must withdraw from your retirement accounts each year. These figures vary for everyone because they are based on your age, life expectancy and money in retirement savings. Many retirees in their 70s must withdraw at least some money from traditional 401(k) plans and traditional retirement savings, not Roth plans, to address complex required minimum distribution rules each year. The Secure 2.0 Act, passed by Congress in late 2022, raised the age for required minimum distributions in general to 73 for those who turned 72 in 2023 and later. If you reached age 73 in 2024, the Internal Revenue Service notes, you could have delayed taking your first required distribution for this year until April 1, 2025, but those who delayed still must take another required minimum distribution for 2025 by Dec. 31, 2025. In other words, those savers who delay would face two required minimum distributions in 2025. Large withdrawals in a year from a traditional pretax 401(k) will trigger taxes and possibly send you into a higher marginal tax rate — and in some cases push you beyond the thresholds for being able to claim the proposed senior "bonus" deduction. Many times, of course, retired people combine income from retirement accounts with Social Security to pay the bills. As a result, Gleckman noted, it can be difficult for many to defer income unless they have a good deal of disposable income. We're talking about many moving parts with what Trump calls "One big, beautiful bill" or OBBB. The proposed enhanced deduction is one provision that those 65 and older will want to watch. Contact personal finance columnist Susan Tompor: stompor@ Follow her on X @tompor.
