The One Big Beautiful Bill Act (OBBBA) introduces a new tax deduction for senior taxpayers.
Beginning with tax year 2025, if you are 65 years old or older, you can take advantage of a $6,000 tax deduction. This is available for each eligible taxpayer, so married couples in which both individuals qualify can deduct $12,000. To qualify for the senior deduction, you must turn 65 on or before the last day of the tax year.
This new senior deduction is subject to phase-out limitations if you have a modified adjusted gross income over $75,000 or $150,000 if you are married and filing jointly. Under existing tax law, you can receive this deduction on top of the additional standard deduction for seniors, whether you itemize or take the standard deduction.
Although this deduction does not eliminate taxes on social security benefits, it could reduce the tax on social security benefits by lowering taxable income for qualifying individuals.
The tax deduction for seniors is available through 2028.
If you have questions about this new deduction or would like to know your options, contact your RKL advisor today.
