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Latest News
New Senior Deduction Explained
Beginning in 2025, seniors can take advantage of a new $6,000 tax deduction that may help them cover the rising costs of housing, health care, and daily living by potentially allowing more of their income to remain untaxed. The deduction, part of the One Big Beautiful Bill Act (OBBBA) enacted in July 2025, will be available through 2028.
Eligibility rules
Taxpayers who are age 65 or older by the end of the tax year and have a modified adjusted gross income (MAGI) of less than $75,000 may claim the $6,000 above-the-line deduction; the deduction gradually phases out for single filers with a MAGI between $75,000 and $175,000 and is completely eliminated for single filers with a MAGI of $175,000 or more. Married taxpayers age 65 or older with a combined MAGI of less than $150,000 and filing a joint tax return can both claim the deduction for a total of $12,000. The deduction for joint filers begins to phase out at $150,000 and is completely eliminated when their MAGI is $250,000 or more.
| Filing Status | Full deduction if MAGI below | Deduction phased out when MAGI exceeds |
|---|---|---|
| Married Filing Jointly | $150,000 | $250,000 |
| All Other Filing Statuses | $75,000 | $175,000 |
Claiming the deduction
For qualified taxpayers, this new deduction can be stacked on top of the standard deduction. For 2025, the standard deduction amount is $15,750 for a single individual and $31,500 for married couples filing jointly. Additionally, individuals age 65 and older get an additional “bump” in their standard deduction in the form of an extra $2,000 deduction ($1,600 per qualifying individual if married filing jointly). Add this all together and this means that, for 2025, an eligible individual can deduct a total of up to $23,750 ($6,000 + $15,750 + $2,000) while qualified married couples may deduct up to $46,700 ($12,000 + $31,500 + $3,200). Because it is an above-the-line deduction, it is available to taxpayers who itemize and to those who do not itemize deductions on their returns. The deduction phases out at a rate of 6% of income exceeding the income thresholds.
Social Security impact
Although this deduction reduces taxable income, it does not directly change the manner in which Social Security benefits are taxed. Benefits remain taxable if the taxpayer’s adjusted gross income, tax-exempt interest income, and half of the taxpayer’s Social Security income exceed $25,000 (single) or $32,000 (married filing jointly). However, the higher deduction may reduce combined income enough to keep a taxpayer below these thresholds, depending on income sources and amounts.
Moving forward
IMPORTANT DISCLOSURES FF Global Capital does not provide investment, tax, legal, or retirement advice or recommendations. The information presented here is not specific to any individual’s personal circumstances. To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances. These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.
Prepared by Broadridge Investor Communication Solutions, Inc. Copyright © 2026
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