The One Big Beautiful Bill Act, enacted on July 4, 2025 as Public Law 119-21, introduced a wide range of changes that will impact tax returns for the 2025 tax year and beyond.
Starting in tax year 2025 through 2028, taxpayers that are age 65 or older can claim a new below-the-line $6,000 deduction. If the primary taxpayer and spouse are both age 65 or older on a return being filed jointly, then this deduction can be claimed by both of them.
This provision was included to help offset taxes on Social Security benefits, however the taxpayer is not required to have Social Security benefits in order to claim it. It can be claimed by taxpayers that are claiming the standard deduction as well as those that are itemizing deductions, however a married couple filing must file jointly to claim this deduction. The deduction is calculated on Schedule 1-A (Form 1040) Part V.
This deduction is gradually phased out for taxpayers over the Modified Adjusted Gross Income (MAGI) threshold at a rate of 6% of the amount over the MAGI.
The following thresholds are in effect for the 2025 tax year:
- Single, Head of Household - $75,000
- Married Filing Jointly, Qualified Surviving Spouse - $150,000
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