"Big, beautiful bill" gives some seniors hefty tax break
Why it matters: The break leaves out the poorest seniors, and the very rich ones, too.
How it works: Both the House and Senate bills include an increased tax deduction for tax filers age 64 and older. In the Senate version, the new deduction is $6,000 for individuals and $12,000 for couples.
The deduction starts phasing out for those who earn over $75,000 ($150,000 for couples), and phases out completely at $175,000 for individuals and $250,000 for couples, in the Senate version.
The break expires in 2028 when President Trump leaves office, as do a few other White House priorities in the bills, including no tax on tips, no tax on overtime, and no tax on auto loan interest.
What they're saying: "This amounts to the largest tax break in American history for our nation's seniors," per a report out earlier this week from the White House Council of Economic Advisers.
Yes, but: Most seniors — 64% of them — don't pay taxes on Social Security, according to the White House's own analysis.
Those who can't afford the taxes already don't pay. This break targets most, but not all, of the rest.
Between the lines: Trump promised to eliminate taxes on Social Security income. Lawmakers couldn't pull that off entirely, given the constraints of passing a reconciliation bill and changing Social Security law.
This break comes close. After adding the recipients of the new tax break, 88% of seniors wouldn't pay Social Security tax, per the White House.
"The One Big Beautiful Bill delivers on President Trump's promise of no tax on Social Security," White House spokeswoman Abigail Jackson says in a statement, noting the analysis by the Council of Economic Advisers.
Zoom out: For those upper-middle class folks who pay taxes on retirement benefits, this is a "substantial tax break," says Marc Goldwein, senior policy director for the Committee for a Responsible Federal Budget, a nonpartisan group that advocates for fiscal responsibility.
For the several million senior citizens who live in poverty, and already don't pay taxes on Social Security, this doesn't help.
The bill would also accelerate Social Security and Medicare insolvency by a year, to 2032, per an analysis from the group.
The bottom line: Seniors in the U.S. overall are doing great financially right now, sitting on assets that have soared in value in recent years.
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CBS News
12 minutes ago
- CBS News
Watch Live: House nears final vote on "big, beautiful bill" after Jeffries sets record for longest speech
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Politico
17 minutes ago
- Politico
Playbook PM: A ‘magic' megabill moment
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Business Insider
17 minutes ago
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Anduril CEO Palmer Luckey's new digital banking startup set to be valued at $2 billion, sources say
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