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PolitiFact Florida
WLRN has partnered with PolitiFact to fact-check Florida politicians. The Pulitzer Prize-winning team seeks to present the true facts, unaffected by agenda or biases.

PolitiFact FL: Older Americans get a tax deduction, but no elimination of Social Security taxation

WLRN Public Media | By Louis Jacobson | PolitiFact
Published July 8, 2025 at 2:55 PM EDT
The Social Security Administration's main campus in Woodlawn, Md.
Associated Press
The Social Security Administration's main campus in Woodlawn, Md.

WLRN has partnered with PolitiFact to fact-check Florida politicians. The Pulitzer Prize-winning team seeks to present the true facts, unaffected by agenda or biases.

President Donald Trump has said the policy bill he signed into law July 4 fulfills his campaign promise to end older Americans' taxes on Social Security.

"We've delivered no tax on tips, no tax on overtime and no tax on Social Security for our great seniors," Trump said in a White House ceremony.

The bill does not end Social Security taxes.

It provides many older Americans who qualify for Social Security with a tax break.

READ MORE: What options does Congress have to shore up Social Security?

A quirk in Senate rules made fully ending Social Security taxation impossible under the massive bill stuffed with his policy priorities. So Republicans used a workaround that achieves a measure of tax relief for older Americans while falling short of a full repeal of taxing Social Security benefits.

More than half of current Social Security beneficiaries pay some tax on their benefits, according to the Social Security Administration. Millions of Social Security recipients will continue paying taxes under this law.

Taxation of Social Security benefits began with 1983 legislation that was designed to help shore up Social Security's finances. The taxes are calculated based on a complicated formula that involves recipients' overall income, their tax-exempt interest income and half of their Social Security benefits. The revenues from taxing Social Security benefits are set aside for the Social Security and Medicare trust funds.

As signed, the bill gives an additional $6,000 tax deduction to people aged 65 and older. These deductions come on top of existing tax deductions for Americans over 65 years old — $2,000 if married or $1,600 if unmarried and not a surviving spouse.

The new deductions are temporary, lasting through 2028.

The reason lawmakers did not repeal taxation of Social Security benefits outright has to do with Senate procedure. To pass the bill with a simple-majority vote, every provision needs to survive a parliamentary vetting process known as the "Byrd bath," named for the late Sen. Robert Byrd, D-W.Va. This process bars directly cutting Social Security.

Under the legislative workarounds, there is significant overlap between people who would benefit from the tax break and people who receive Social Security payments. But not every Social Security recipient would benefit.

One group that would not receive the tax break is people who are direct Social Security beneficiaries younger than 65. In December 2024, federal data shows, about 5% of retired Social Security beneficiaries were ages 62 to 64.

Other groups that would not get the deduction are retired workers' dependents, deceased workers' survivors, and disabled workers and their dependents who are not yet 65.

Finally, wealthier taxpayers would not benefit. The tax break would phase out at higher income levels — at $175,000 for single filers and $250,000 for joint filers, according to the Tax Foundation, a center-right think tank.

Millions of Social Security recipients would still pay tax under the new law.

Thomas A. Barthold, the chief of staff for the Joint Committee on Taxation — the bipartisan body of Congress that analyzes the proposed tax legislation's impact — said in May that if existing law remains in place, about 27 million tax returns would include some amount of income tax owed on Social Security benefits in 2026.

If the House version had been enacted — a version that was less generous than the Senate version that made it into the final bill — that number would fall to 24 million, Barthold said. We were unable to find an analysis of the version that became law, but extrapolating from Barthold's estimate, it would still be expected to include millions of people who have to pay some tax on their Social Security benefits.

Tax Foundation projections show that the enacted version should be more generous to lower- and middle-income taxpayers than what Trump promised. For taxpayers earning less than about $75,000, the gains from the new law exceeds what they could have gotten from a simple elimination of Social Security taxation.

Ultimately, the Big Beautiful Bill is poised to produce tax relief for many Social Security recipients, but it would not eliminate Social Security taxation altogether, as Trump promised. The deduction enacted archives less than the full promise but is still a significant accomplishment consistent with the original promise's goal, so we rate the promise a Compromise.

Our Sources
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Government & Politics NewsTrump AdministrationSocial Security
Louis Jacobson | PolitiFact
Louis Jacobson has been with PolitiFact since 2009, currently as chief correspondent.
See stories by Louis Jacobson | PolitiFact
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