The One Big Beautiful Bill Act (OBBBA) reduces federal tax burdens for retirees by exempting Social Security income. A senior deduction of $6,000 for single filers and $12,000 for married couples aged 65 and over is part of the act. This change, combined with other deductions, enables seniors to reach as high as $23,750 in deductions individually or $46,700 for couples. Consequently, 88% of seniors are expected to owe no federal tax on their Social Security income, significantly up from 64% prior to the law's enactment.
The OBBBA established a senior-specific tax deduction: $6,000 for single filers and $12,000 for married couples where both spouses are over 65.
As a result, 88% of all seniors are now expected to owe no federal tax on their Social Security benefits, compared to just 64% before the law was enacted.
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