Trump Tax Plan: Will Social Security Taxes Get Cut?

President Donald Trump advocated for the elimination of federal income taxes on Social Security benefits during his 2024 campaign. However, the tax legislation recently passed by the House—known as the One Big Beautiful Act—does not include this provision. The exclusion stems from Senate rules governing the budget reconciliation process, which restrict changes to Social Security programs. Instead, the bill introduces a temporary $6,000 tax deduction for seniors aged 65 and older, effective from 2026 through 2028, with income-based eligibility limits.

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Key Takeaways

Trump’s new tax bill does not eliminate taxes on Social Security benefits, despite earlier campaign promises.
Instead, it offers a temporary $6,000 standard deduction for seniors aged 65 and older from 2026 to 2028.
Repealing Social Security taxes would mostly benefit higher-income retirees and reduce federal revenue by about $1.6 trillion over 10 years.

Is Trump Eliminating Taxes on Social Security Benefits?

During his 2024 campaign, Donald Trump expressed opposition to taxing Social Security benefits, stating on Truth Social, “SENIORS SHOULD NOT PAY TAX ON SOCIAL SECURITY!” He reiterated this stance in his 2025 State of the Union address, advocating for “no tax on tips, no tax on overtime and no tax on Social Security benefits for our great seniors.”

Despite these declarations, the One Big Beautiful Act does not eliminate taxes on Social Security benefits. Instead, it introduces a temporary $6,000 enhanced standard deduction for seniors aged 65 and older, effective from 2026 through 2028, with income-based eligibility limits. The exclusion of the Social Security tax repeal is attributed to Senate budget reconciliation rules, which prohibit changes to Social Security programs through this legislative process.

Analyses indicate that repealing taxes on Social Security benefits would primarily benefit higher income retirees. Further, it could reduce federal revenue by approximately $1.6 trillion over the next decade, potentially accelerating the insolvency of the Social Security trust fund.

How Social Security Benefits Get Taxed

A financial advisor calculating Social Security taxes for a client.

Social Security benefits can be subject to federal income tax depending on your combined income. This includes your adjusted gross income (AGI), any nontaxable interest and half of your Social Security benefits.

If you file as an individual and your combined income is between $25,000 and $34,000, up to 50% of your benefits may be taxable. If your income exceeds $34,000, up to 85% of your benefits may be taxed. For married couples filing jointly, the thresholds are $32,000 and $44,000, respectively.

Take, for example, a couple with $30,000 in AGI, $2,000 in tax-exempt interest and $24,000 in annual benefits. They would have a combined income of more than $44,000, putting them at the threshold where up to 85% of their benefits could be taxable.

Taxes on Social Security are not withheld automatically unless requested. Beneficiaries can choose to have federal taxes withheld at 7%, 10%, 12% or 22%. Alternatively, they can make estimated tax payments throughout the year.

At the state level, most states do not tax Social Security benefits. However, some states do, although often with exemptions or income limits. These states are Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah, Vermont and West Virginia. Because rules vary widely, the impact depends on your state of residence.

These tax rules have been in place since 1984, when Congress first made a portion of benefits taxable to help fund the Social Security program. The 85% threshold was added in 1993. Despite periodic proposals to adjust or eliminate these taxes, the rules have remained largely unchanged, even as average benefit amounts and retiree incomes have risen over time.

How Expanded Standard Deduction Would Impact Seniors

The One Big Beautiful Act includes a temporary increase to the standard deduction for taxpayers aged 65 and older. Under the proposal, seniors would receive an additional $6,000 deduction on top of their regular standard deduction. This enhancement would apply for tax years 2026 through 2028.

Eligibility for the deduction is income-limited. For single filers, the enhanced deduction phases out starting at $75,000 of modified adjusted gross income (MAGI). For married couples filing jointly, the phaseout begins at $150,000.

As an example, consider a married couple, both over age 65, with a combined MAGI of $150,000 in 2025. Under existing rules, their standard deduction would be $33,200. With the $6,000 enhancement, and a higher standard deduction of $32,000 for joint filers under the new tax law, it would increase to $38,000. That additional $6,000 deduction reduces their taxable income from $116,800 to $110,800. While it doesn’t exempt Social Security income from taxation, it does provide modest tax relief to seniors within the eligible income range.

How the One Big Beautiful Act Affects Seniors

One Big Beautiful Act Provisions	Benefits for Retirees
$6,000 enhanced standard deduction for seniors age 65+ (phased out at $75,000 for single filers and $150,000 for joint filers)	Lowers taxable income, reducing tax liability for eligible seniors.
Extension of zero tax on tips and overtime	Could benefit working seniors with tip or overtime income.
Expansion of child tax credit and family-related benefits	May help seniors indirectly by supporting grandchildren or dependents.

Seniors should also note:

Trump’s new tax law does not repeal federal taxes on Social Security benefits. There is no mention of such a repeal anywhere in the legislative text.
The legislation does not include a caregiver tax credit or a dependent senior deduction, and no provisions target unpaid caregiving specifically.

How Seniors Can Minimize Retirement Taxes

Seniors can reduce retirement taxes by planning when and how they withdraw money. Retirement accounts are taxed in different ways. Traditional IRAs and 401(k)s are taxed when money comes out, while Roth IRAs offer tax-free withdrawals. By combining withdrawals from these sources, seniors can manage how much taxable income they report each year. And this can help avoid bumping into higher tax brackets and keep more income in their pocket.

Another way to lower taxes is by controlling when to take required minimum distributions (RMDs). Starting at age 73, the IRS requires retirees to withdraw a set amount each year from tax-deferred accounts. But seniors can prepare ahead by converting some of their IRA or 401(k) money to a Roth in earlier retirement years, which may lower future RMDs. This can also help reduce taxes on Social Security benefits, which become taxable once income crosses certain limits.

Seniors should also pay attention to other types of income like capital gains, dividends, part-time wages and rental earnings. Selling investments in low-income years, for example, may qualify them for lower capital gains tax rates. Taking advantage of deductions—such as those for medical expenses, charitable giving, or the higher standard deduction available to those over 65—can also lower their overall tax bill.

Putting all of these strategies together can lead to significant tax savings over time. Even small adjustments each year, like managing the source of retirement withdrawals or bunching deductions into a single year, can have a long-term impact. A clear plan helps seniors keep more of their income and make their savings last longer.

Bottom Line

A taxpayer calculating their standard deduction.

Trump’s One Big Beautiful Act introduces a temporary $6,000 tax deduction for seniors aged 65 and older, applicable from 2026 through 2028. This provision aims to reduce taxable income for eligible seniors, offering some financial relief. However, the law does not eliminate taxes on Social Security benefits, a change that would require separate legislative action.

Retirement Planning Tips

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Mandatory distributions from a tax-deferred retirement account can complicate your post-retirement tax planning. Use SmartAsset’s RMD calculator to see how much your required minimum distributions will be.