Tax Relief for Seniors: Higher Income Thresholds for Social Security Benefits.
This Act increases the income thresholds above which Social Security benefits are subject to federal taxation. This change means many retirees will pay less in federal taxes or avoid taxation on their benefits entirely. The new rules apply to tax years beginning after December 31, 2024, and include an inflation adjustment mechanism to protect seniors from future excessive taxation.
Key points
Increased income thresholds (Base Amount) for taxing Social Security benefits: the threshold rises to $34,000 for single filers and $68,000 for married couples filing jointly.
Introduction of an inflation adjustment mechanism for these thresholds, starting in the 2025 tax year, to prevent the erosion of tax relief over time.
Social Security and Railroad Retirement funds are protected: any reduction in transfers due to these tax changes will be covered by appropriations from the general federal budget (funded by rescinding non-security discretionary appropriations).
Expired
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