Trump promised that there would be no tax on social security. At this point he didn’t deliver. While the Fox pundits continue to lie and say that the one big beautiful bill contains no tax on social security. Nothing could be further from the truth. The bill in the House contains a $4000 dollar regular deduction, not a tax credit, for social security recipients . This is a huge difference and considering that the it will be phased out through 2029 I think. And it also reduces the amount of the deduction based on income I think starting at $75 K and probably means that I will get no tax break.

First I know serendipitously that eliminating income tax on social security would reduce my income tax by over $4000 because last year I had all my tax done because I couldn’t find my W-2 from the SSA. So I got it on line and put it in and my tax went up by over $4000. And I was looking forward to Trump giving me a $4000 raise, and he may still be giving lip service to this but he didn’t get through the House.

Now just so you understand what the difference is. If you say have $100K gross income and the applicable tax rate is 15%, your tax is $15K. Now assuming your gross social security is $20K, then your tax would be $80K times 15% or $12k . You would save at least $3K. I say at least $3K because in all likelihood the tax rate would be less and you would save even more.

Now let’s compare that to what they are apparently doing. You get to deduct $4000 from your 100K and then pay tax on $96K would be 14.4K. A savings of $600! Thus the whole thing coming out of the House is just insulting and in my case wouldn’t do anything.

BTW The numbers used above are not reflective of my actual numbers.