New Hampshire’s senior citizens could see major tax relief starting in 2026 thanks to the One, Big Beautiful Bill.

This federal legislation, passed under the Trump administration, introduces a senior deduction that effectively exempts most Social Security benefits from federal income taxes.

For the state’s aging population, the policy could deliver meaningful tax benefits during a time when many are hoping to age in place in their homes, but need the extra money in order to do so.

A national tax shift for retirees

According to the White House, the bill passed raises the share of retirees who won’t pay federal income tax on their Social Security from 64% to 88%—an increase of 14.2 million people across the U.S.

This is made possible by a new tax deduction of $6,000 for single seniors and $12,000 for married couples over the age of 65. The so-called senior deduction sits on top of existing exemptions and the standard deduction, ensuring most recipients no longer owe taxes on Social Security income.

“This amounts to the largest tax break in history for America’s seniors,” the administration said in their press release.

A closer look at New Hampshire’s senior population

New Hampshire is home to approximately 300,000 retirees, based on 2023 Census estimates. The state’s 65+ population represents about 21.8% of the total—one of the highest senior percentages in the country.

Though it accounts for just under 0.5% of the U.S. senior population, nearly all New Hampshire seniors are expected to benefit from this new tax structure.

Financially, seniors still working in New Hampshire are also in a strong position under the bill. Projected real wage increases range from $4,500 to $8,100, with real take-home pay improvements of $8,100 to $11,900—among the top 10 states nationally.

The state is also set to gain 700 new Opportunity Zone housing units.

Who benefits—and who misses out

While the deduction is broadly impactful, not all retirees will benefit equally. As outlined in the Realtor.com® overview of the senior tax deduction, the deduction begins phasing out at $75,000 for individuals and $150,000 for couples, disappearing entirely at $175,000 and $250,000 respectively. Additionally, seniors with no federal tax liability—often those living solely on Social Security—won’t see a refund or direct savings from this deduction.

That leaves middle-income seniors as the primary beneficiaries—especially those who still owe some taxes and can use the deduction to meaningfully lower their taxable income. For this group, the senior deduction could help cover these growing expenses, especially when paired with the bill’s increase of the SALT deduction cap from $10,000 to $40,000.

This expanded deduction may provide much-needed breathing room in a state with some of the highest property taxes in the country.

What comes next?

The deduction is only guaranteed through the 2028 tax year. Unless Congress acts to extend it, the benefit could sunset, reintroducing the tax burden on Social Security income for millions of seniors nationwide—including the 300,000 in New Hampshire.

Still, the combination of the senior tax deduction and expanded SALT cap delivers meaningful near-term relief. And for retirees trying to preserve financial stability without selling their homes, this shift in federal tax policy may be enough to tip the scales.

For New Hampshire’s older adults, especially those in property-tax-heavy towns, that’s a reason to pay close attention to how these tax benefits play out at the local level.

This article was produced with editorial input from Dina Sartore-Bodo, Gabriella Iannetta, and Allaire Conte.