The simple answer is no.
Over the weekend, many of us received an unusual email from the Social Security Administration representing an unprecedented use of a government agency as a platform to promote recently passed legislation. We have been contacted by several clients this morning wondering if this is a scam. It is not. The text of the email can be seen on the SSA website under press releases.
The email asserts that the One Big Beautiful Bill (OBBA) that was signed into law last week "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 misleading. The bill does not specifically address the taxation of Social Security. Current rules regarding the taxability of Social Security remain in place. What it does do, is to provide a temporary deduction of up to $6000 for seniors with income of less than $75,000 for single filers and $150,000 for married filers. This deduction should offset some of the Social Security benefits that senior taxpayers are required to include in income. The deduction gradually tapers off as income rises and is completely phased out at $175,000 single and $250,000 married.
While this will benefit many of our clients, a $6000 deduction will not offset the social security that most of our clients must include in taxable income. Most of our clients will continue to pay taxes on a portion of their benefits. This deduction is temporary and will span the years 2025 through 2028 only. This one provision is expected to cost 90 billion dollars over 4 years.
Over the weekend, many of us received an unusual email from the Social Security Administration representing an unprecedented use of a government agency as a platform to promote recently passed legislation. We have been contacted by several clients this morning wondering if this is a scam. It is not. The text of the email can be seen on the SSA website under press releases.
The email asserts that the One Big Beautiful Bill (OBBA) that was signed into law last week "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 misleading. The bill does not specifically address the taxation of Social Security. Current rules regarding the taxability of Social Security remain in place. What it does do, is to provide a temporary deduction of up to $6000 for seniors with income of less than $75,000 for single filers and $150,000 for married filers. This deduction should offset some of the Social Security benefits that senior taxpayers are required to include in income. The deduction gradually tapers off as income rises and is completely phased out at $175,000 single and $250,000 married.
While this will benefit many of our clients, a $6000 deduction will not offset the social security that most of our clients must include in taxable income. Most of our clients will continue to pay taxes on a portion of their benefits. This deduction is temporary and will span the years 2025 through 2028 only. This one provision is expected to cost 90 billion dollars over 4 years.
RSS Feed