There is no separate tax credit for Social Security. Instead, it provides a new tax deduction that significantly reduces or eliminates the tax burden for many seniors, particularly those with low to moderate income.
The new law doesn't get rid of Social Security taxes completely. It helps by giving seniors a new, temporary $6,000 tax deduction.
- Yes, Social Security can still be taxed if your Modified Adjusted Gross Income (MAGI) exceeds certain thresholds.
- The old 50% and 85% inclusion rules still apply in some cases, but:
- The new senior deduction ($6,000 per person) and standard deduction ($15,750 single / $31,500 joint) significantly reduce taxable income.
- This means many working seniors will still owe no tax on their Social Security, unless their income is quite high.
- The new deduction begins to phase out for single filers with a Modified Adjusted Gross Income (MAGI) over $75,000 and for married couples filing jointly with a MAGI over $150,000. It is completely phased out for single filers at $175,000 and for joint filers at $250,000.
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