New tax legislation And SS

[prherr]

For a married couple 65+, how does the latest tax bill affect how much of my spouse’s 25 k in SS will be taxable in the following scenario:  earned income about $100k, pension about $50k, interest, capital gains about $30k.  Will we have to pay tax on $25k in SS given the standard deduction, $6.5k property taxes, and the new deduction for seniors?  

[VolvoGirl]

The taxable amount of SS has not changed.    Up to 85% of Social Security becomes taxable when all your other income plus 1/2 your social security, reaches:

Married Filing Jointly: $32,000

Single or head of household: $25,000

Married Filing Separately: 0

But there is a new Enhanced Deduction for Seniors of $6,000 for each spouse 65 or older if you qualify. The income limit is 75,000 (150,000 Joint). That is listed separately on your return and is in addition to the Standard Deduction or your Itemized Deductions and is after any Social Security taxable amount on line 6b. The deduction for seniors will be allowed for 4 years, from 2025 through 2028.  It will be on new 1040 Schedule 1-A

I just made an Excel spreadsheet to calculate the deduction 

 How much is your Total Income?  

[VolvoGirl]

For Joint the Deductions phases out at 250,000.    See draft of 1040 Schedule 1-A page 2 part V
https://www.irs.gov/pub/irs-dft/f1040s1a--dft.pdf

[prherr]

Estimate $110k  income, $30k interest and dividends, and $25k SS.  

[VolvoGirl]

Based on your top question 100,000 earned income + 50,000 pension + 30,000 int& div + 25,000 SS I get

100K + 50K + 30K + 21,250 SS  (85% of 25k) - Standard Ded 34,700 = 166,550 AGI

Gives you a Senior Deduction of $10,014.   

[prherr]

Thanks!

[VolvoGirl]

@prherr   Oh, Sorry.  I figured it on your Taxable income not your AGI which is before the Standard Deduction.  So your AGI would be 201,250 which gives you the new Senior Deduction of 5,850 for Joint .  

[prherr]

Thanks for following up!