We are both retired and receiving regular Social Security benefits, although we are fortunate to have other income as well. We pay income taxes every year, although I don’t really know what amount we pay on the Social Security part of our income.
In the early hours of this morning I wasn’t sleeping well so I got up for a little bit, and saw that I had received a congratulatory email from SS admin touting the new tax benefits for seniors.
The bill ensures that nearly 90% of Social Security beneficiaries will no longer pay federal income taxes on their benefits, providing meaningful and immediate relief to seniors who have spent a lifetime contributing to our nation’s economy.
“This is a historic step forward for America’s seniors,” said Social Security Commissioner Frank Bisignano. “For nearly 90 years, Social Security has been a cornerstone of economic security for older Americans. By significantly reducing the tax burden on benefits, this legislation reaffirms President Trump’s promise to protect Social Security and helps ensure that seniors can better enjoy the retirement they’ve earned."
In other words, while seniors who live only on Social Security get no benefit because they are already all or mostly tax-free, seniors at higher income levels will now be able to build their family fortunes in order to pass them on as inherited wealth to their next generations.
Well ha, ha to the planners of this change. If my husband survives me, all our accumulated wealth will be going to members of his family in Japan. And if I survive him, it will be going to various charities here in the US, where I’m sure it will be even more sorely needed than it is today.
(I await with breathless anticipation the self-congratulatory email from Mr. Bisignano when Social Security benefits are reduced, and millions of seniors are thrown into worse poverty than they now endure.)
I also received that email and my immediate thought was with my luck I will be in the 10% who won’t benefit. I think it’s ridiculous that SS is taxed so although I most likely will benefit, I will certainly not thank the FOTUS.
Yes, I thought about that. It should be pretty easy to figure the amount, year-over-year our income doesn’t hardly change (definition of fixed income, after all) except for Social Security cost-of-living increases.
I don’t think the email says that i benefit. I think it just says that lots of people will get more money, (or pay less tax) and i might be one of them.
I’m mostly pissed about the SS database being used to send political spam.
90% of those receiving social security will benefit, so I can well imagine that the only ones who don’t benefit are those already paying no taxes due to low income.
And it’s not just the SS database being used, it’s the SS admin itself that has been politicized. I don’t think I have ever seen an email like this before from Social Security (in the nature of “Ooh, look what we did for you!”) and I don’t like it either.
The full benefit applies to income levels up to $75k for individuals or $150k for married couples. It’s then lowered at a 6% phase-out rate up to $175k indiv and $250 joint filers.
And of course, it won’t apply to very low income people, as others have posted.
From what I can understand, I am not going to see more money on my monthly check. The tax reduction comes from increasing the standard deduction for seniors. That does not translate to me getting an increase in my monthly check. Please correct me if I’m wrong. It’s hard to even understand articles from mainstream press on this topic
As a retired Federal employee my entire income has until now been my Federal pension plus some investment dividends and IRA dispersions. This year, due to Biden’s Social Security Fairness Act I’m starting to receive survivor’s benefits on my late wife’s account. I haven’t yet tried to figure out how much, if any, of these benefits will be taxable. Now I’m think I’m just going to wait until I can get specifics how (or if) this will be changing.
I read it as the 40% who already pay no taxes will be part of the 90% as well. You are correct in that they won’t see any added benefit, but they are certainly counted in that 90% figure.
And the taxes on SS won’t change. It’s just that the added ‘senior deduction’ will mean that more income will no longer be subject to any income tax, including SS benefits.
I think we have to be careful to look at all the consequences of this POS legislation before deciding whether or not we “benefit.” Most particularly for seniors: yes some of us may pay lower taxes on our social security income, but any savings are likely to be offset by other, perhaps more subtle effects of this legislation, particularly as it affects health care (How Trump's tax bill will affect Medicaid, ACA plans and hospitals : Shots - Health News : NPR)
For example, I got a message from friend just this morning: Her granddaughter, already with two small children and a husband who makes laborer’s wages, found that, since the BBB cut off support for Planned Parenthood, Medicaid no longer covers her birth control.
Don’t go spending that SS “windfall” just yet. I have this awful premonition that the vast majority of us will end up screwed by the time the final turd from this explosive diarrhea hits our collective windshields.
So my understanding is that the SS tax is only good for 4 years. And I think of the seniors who do benefit, most will see an annual tax savings of $1000 a year or so.
Which is good, I’m all for helping cut taxes for middle income elderly people (although with our deficit as high as it is, eventually we all need to accept we need to pay more taxes eventually).
But its my understanding that this part of the bill will cost about $90 billion over 4 years. That’s around 22 billion a year for this provision, since it expired in 4 years.
Meanwhile in the bill that just passed, the highest earning 5% will experience close to 2 trillion in tax cuts over the next decade.
This is typical republican ploy. Offer crumbs to the working class and middle class so they’ll support laws that give trillions to the rich.
Also the fact that this provision expires in 2028 was smart on the GOP’s part. Now the GOP can blame the democrats if this doesn’t get extended if the dems win in 2028.
Meanwhile, I think total spending on politics, when amortized (and including lobbying) is about 10 billion a year. The rich are getting an amazing return on their investment in politics.
Well, we are decidedly middle class, and my SocSec is close to my mortgage. But part of it becomes taxable every year, due to Reagan (he made SocSec and Unemployment taxable to lower the tax rates for his rich buddies).
So, no wealth will be passed on, nor are we at “higher income levels”. We will benefit. Likely saving maybe $1000 a year.
Yeah, it it not just the rich. In fact they dont qualify anyway.
But still I opposed the tax bill. However, every cloud has a silver lining.
Right. Reagan lowered the marginal tax rate from 70% to 28%, but added in taxes on Socsec, etc. We need the marginal tax rate back to 70%.
Same here but FERS not CRS. FERS retirees need Socsec.
Of course, but the benefits for the Rich continue, just like trumps other tax breaks earlier.
SS was considered controversial when FDR wanted it in 1935, for this very reason. I assume they didn’t imagine how in our lives the government would be, but it was still contested and argued about.
They certainly didn’t imagine Trump and his cohorts.
I think they may have worried about fascism, at the time. Being when it was. And all.
They have all our info. They just do. Pandora can’t close the box.
