Chip Somodevilla \/ Getty <\/p>\n
Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below.<\/p>\n
Back in July, the White House issued a statement claiming that \u201c88% of all seniors who receive Social Security \u2014 will pay NO TAX on their Social Security benefits\u201d because of President Donald Trump\u2019s new One Big Beautiful Bill Act (1).<\/p>\n
The White House claimed this to be \u201cthe largest tax break in American history for our nation\u2019s seniors.\u201d<\/p>\n
However, the White House cited the U.S. Council of Economic Advisers (2), a branch of the President\u2019s office, as the source for this claim rather than an independent body.<\/p>\n
Experts at the Center for Budget and Policy Priorities (CBPP), meanwhile, have taken a closer look at the megabill\u2019s impact on the Social Security program and found that the claims could be \u201cfalse and exaggerated (3).\u201d<\/p>\n
Understanding why experts disagree with the Trump administration on this issue could help you and your loved ones figure out if the new bill will help your finances or hurt you instead.<\/p>\n
The White House\u2019s calculations hinge on the megabill\u2019s new and raised tax deductions for many seniors.<\/p>\n
Starting this year, seniors aged 65 and above can claim a new deduction of up to $6,000 per person. For couples filing jointly, that could mean up to $12,000 if both spouses qualify.<\/p>\n
These deductions reduce taxable income for older Americans. However, the White House acknowledged that about 64% of Social Security recipients already paid no federal tax on their benefits before the new law, thanks to existing deductions and exemptions.<\/p>\n
Eligibility isn\u2019t based on age alone \u2014 modified adjusted gross income (MAGI) also matters.<\/p>\n
Only Individuals earning $75,000 or less can claim the full deduction. After this, it phases out and vanishes completely at $175,000. For joint filers, it starts phasing out at $150,000 and disappears entirely at $250,000.<\/p>\n
Meanwhile, older Americans who are barely getting by likely won\u2019t have the income necessary to take advantage of the deduction. If your total allowable deductions already exceed your income, an extra $6,000 doesn\u2019t do much.<\/p>\n
It\u2019s also worth noting that the White House\u2019s figures consider only beneficiaries aged 65 and over, but Social Security can be claimed as early as 62, meaning a portion of the recipient population is excluded from their estimate.<\/p>\n
If your household income exceeds this $175,000 threshold for single filers and $250,000 for joint filers, you might want to consider employing tax-planning strategies to find ways to reduce your tax bill at the end of the year.<\/p>\n
Getting a clear estimate of your Social Security benefits \u2014 and the taxes that could come with them \u2014 can make a huge difference in deciding when to start claiming.<\/p>\n
A financial advisor can help you run the numbers and avoid costly mistakes when it\u2019s time to file.<\/p>\n
You can find a vetted FINRA\/SEC-registered advisor near you through Advisor.com<\/a>.<\/p>\n Just answer a few questions about your financial situation and future goals, and Advisor.com will match you with an advisor best suited to your needs.<\/p>\n Set up a free introductory call today<\/a> to see if your match is the perfect fit.<\/p>\n Read More: Approaching retirement with no savings? Don\u2019t panic, you’re not alone. Here are 6 easy ways you can catch up (and fast)<\/a><\/p>\n The White House\u2019s claims regarding eliminating taxes on social security has been challenged by many.<\/p>\n On July 14, 2025, 11 senators sent a letter to Frank Bisignano, the Commissioner of the Social Security Administration, pointing out how \u201cwholly inaccurate\u201d the claim made by the White House is (4).<\/p>\n \u201cWhile the bill does provide a temporary income tax deduction for some older Americans, only about 46% of older adults would benefit from this deduction,\u201d the letter says. \u201cThe SSA press release claimed the bill would eliminate taxes on Social Security for 90% of beneficiaries, but the truth is that about half of recipients will owe some amount of income tax on their benefits.\u201d<\/p>\n In total, fewer than 24% of all current Social Security recipients will see a reduction in taxable income directly due to the new law, according to the CBPP. This doesn\u2019t meet Trump\u2019s campaign promise to eliminate all taxes on Social Security, and it also has second-order effects that could actually expose many seniors to lower benefits over the long term.<\/p>\n The new senior deduction is temporary and only applies through 2028. Most older Americans who benefit from it will have just four years to take advantage of the savings.<\/p>\n At the same time, the cost of all the tax deductions and reductions in Trump\u2019s megabill could reduce federal tax revenue from Social Security benefits by $30 billion annually, according to the CBPP.<\/p>\n \u201cThis is enough to accelerate the insolvency of the Social Security retirement fund and Medicare Hospital Insurance fund to 2032, a year sooner than the program\u2019s trustees projected just last month,\u201d the report stated.<\/p>\n \u201cUpon insolvency in 2032, we estimate that Social Security beneficiaries would face an across-the-board benefit cut of around 24 percent \u2014 even deeper than the cuts scheduled under current law,\u201d the CBPP report claimed.<\/p>\n And the CBPP isn\u2019t alone in this assessment.<\/p>\n The Committee for a Responsible Budget also estimates that the SSA\u2019s retirement trust fund will go broke in 2032 without intervention. If the fund goes bankrupt, the report states that all retirees will face an across-the-board benefit cut of 24%. For couples retiring after the fund\u2019s insolvency, that could mean a combined $18,400 reduction in benefits (5).<\/p>\n In other words, the new law likely offers short-term tax relief for some seniors, but at the expense of the long-term stability of Social Security and Medicare trust funds, which affects all beneficiaries.<\/p>\n The newly passed One Big Beautiful Bill Act also slashed Medicaid spending by roughly $1 trillion over the next decade. This could result in nearly 11.8 million Americans losing their health insurance by 2034, according to estimates from the Congressional Budget Office (6).<\/p>\n Taken together, this suggests that in the early 2030s, some older Americans could see their Social Security benefits crash while also losing their health insurance.<\/p>\n Chances are, Social Security paychecks won\u2019t be enough to cover your expenses during retirement. And if you don\u2019t meet the income requirements outlined in the OBBBA, you are required to pay taxes on these government checks.<\/p>\n But there are other ways to boost your retirement savings without paying an arm and a leg in taxes. One option would be to invest in residential real estate.<\/p>\n You can tap into this market by investing in shares of vacation homes or rental properties through Arrived<\/a>.<\/p>\n Backed by world-class investors like Jeff Bezos, Arrived allows you to invest in shares of vacation and rental properties<\/a>, earning a passive income stream without the extra work that comes with being a landlord of your own rental property.<\/p>\n To get started, just browse through their selection of vetted properties, each chosen for their potential appreciation and income generation. Once you find a property you love, you can start investing with as little as $100<\/a>.<\/p>\n If diversifying into multifamily rentals appeals to you, you could consider investing with Lightstone DIRECT<\/a>, a new investing platform from the Lightstone Group, one of the largest private real estate companies in the country with over 25,000 multifamily units in its portfolio.<\/p>\n Since they eliminate intermediaries \u2014 brokers and crowdfunding middlemen \u2014 accredited investors with a minimum investment of $100,000 can gain direct access to institutional-quality multifamily opportunities. This streamlined model can help reduce fees while enhancing transparency and control.<\/p>\n And with Lightstone DIRECT, you invest in single-asset multifamily deals alongside Lightstone \u2014 a true partner \u2014 as Lightstone puts at least 20% of its own capital into every offering. All of Lightstone\u2019s investment opportunities undergo a rigorous, multi-stage review before being approved by Lightstone\u2019s Principals, including Founder David Lichtenstein.<\/p>\n How it works is simple: Just sign up with your email, and you can schedule a call with a capital formation expert<\/a> to assess your investment opportunities. From here, all you have to do is verify your details to begin investing.<\/p>\n Founded in 1986, Lightstone has a proven track record of delivering strong risk-adjusted returns across market cycles with a 27.6% historical net IRR and 2.54x historical net equity multiple on realized investments since 2004. All told, Lightstone has $12 billion in assets under management \u2014 including in industrial and commercial real estate.<\/p>\n As such, even if multifamily rentals don\u2019t appeal to you, Lightstone could still serve you well as an investment vehicle for other real estate verticals.<\/p>\n Get started today with Lightstone DIRECT<\/a> and invest alongside experienced professionals with skin in the game.<\/p>\n We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines<\/a>.<\/p>\n The White House (1<\/a>), (2<\/a>); Center on Budget and Policy Priorities (3<\/a>); United States Senate (4<\/a>); The Committee for a Responsible Budget (5<\/a>); UC Berkeley Public Health (6<\/a>)<\/p>\n This article provides information only and should not be construed as advice. It is provided without warranty of any kind.<\/p>\n","protected":false},"excerpt":{"rendered":"Chip Somodevilla \/ Getty Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the…\n","protected":false},"author":2,"featured_media":425441,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[39],"tags":[28,155,148166,38167,1168,5011,147,530,942,733,45864,3123],"class_list":["post-425440","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-business","tag-dave-ramsey","tag-deductions","tag-income-tax","tag-jeff-bezos","tag-older-americans","tag-personal-finance","tag-personalfinance","tag-president-donald-trump","tag-social-security","tag-taxable-income","tag-white-house"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/425440","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=425440"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/425440\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/425441"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=425440"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=425440"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=425440"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}