General Discussion
In reply to the discussion: What is wrong with the tax cut for SS recipients. Although I will save [View all]gab13by13
(30,959 posts)how the 6k standard deduction could affect taxes on SS.
"Example: Consider a 67-year-old single retiree with $25,000 in Social Security and $18,000 from a retirement account. To determine if any Social Security is taxable, the IRS looks at "combined income." In this case, thats $12,500 (half of $25,000) plus $18,000, totaling $30,500.
This fictional retirees combined income is just above the $25,000 threshold where Social Security benefits start to be taxed.
Under normal circumstances, a portion of their benefits would be included in taxable income.
However, if the bonus GOP deduction is available, it would reduce their taxable income, potentially lowering their combined income calculation as well.
With the bonus deduction and the OBBBA standard deduction proposed for 2025, their taxable income could drop enough to bring their combined income below the threshold or at least reduce how much of their Social Security is taxed."