"The bill would amend the Internal Revenue Code of 1996 by eliminating the inclusion of Social Security benefits in gross income, beginning in the year after enactment. Rep. Angie Craig (D-Minn.) has introduced companion legislation in the House of Representatives. Gallego's legislation comes as President Donald Trump claims he ended taxes on Social Security through the One Big Beautiful Bill Act."
"That legislation, which passed in July, ensures that nearly 90% of beneficiaries will no longer pay federal income taxes on their benefits by providing an enhanced deduction of $6,000 for taxpayers ages 65 and older. Under Gallego's bill, earnings above $250,000 would remain subject to the payroll tax, extending the Social Security trust fund's solvency through 2058 26 years beyond the current projection that benefits will be reduced in 2032."
The proposal would amend the Internal Revenue Code to exclude Social Security benefits from gross income beginning the year after enactment. A companion bill has been introduced in the House. The One Big Beautiful Bill Act passed in July provides a $6,000 enhanced deduction for taxpayers 65 and older, eliminating federal income taxes for nearly 90% of beneficiaries. Under the proposal, earnings above $250,000 would remain subject to payroll tax, extending Social Security trust fund solvency to 2058, 26 years beyond current projections. The program ran a $41 billion deficit in 2023 after benefits exceeded revenues since 2021. Supporters say the change reduces taxes for millions while funding benefits responsibly.
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