Hello,
There is a new Senior Deduction under the One Big Beautiful Bill which allows up to a $6k deduction per taxpayer for taxpayers 65 or older by the end of 2025.
The deduction has a phase out triggered once Modified Adjusted Gross Income (MAGI) exceeds $75k for a single taxpayer or $150k for married filing jointly taxpayers.
Assuming your figures are the same for 2024 and 2025.Here's how to figure out if your income will be under the phase out trigger:
- Adjusted Gross Income (AGI) = total gross income from all sources less certain adjustments on Schedule 1 of Form 1040 (resource: Definition of adjusted gross income)
- Add back: Foreign Earned Income Exclusion
- Add back: Excluded income from U.S. territories
If the total is under $75k/$150k (single/married filing jointly), then you'll get the full deduction.
If you income exceeds the threshold for the phase out , then the senior deduction will not apply. However we do have a tax calculator which should help you estimate your tax liability: https://turbotax.intuit.com/tax-tools/calculators/taxcaster/ It is for 2024 as it has not been updated for 2025. Once the IRS updates all the changes from the OBBB, TurboTax will update the calculator for 2025
I hope this answers your question.
Mary, tax expert
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