Taxes at 65 and Older: The New Senior Deduction

1"Social Security is no longer taxed."

The rules for taxing Social Security did not change. Whether part of your benefit is taxable is still decided by your combined income, the same test that has applied for decades, explained in our guide to whether Social Security is taxable. What changed is the amount of income you can deduct before tax is figured.

For many retirees the result feels like the same thing. A married couple over 65 can now deduct $47,500 before any federal income tax is due, and if their taxable income, including the taxable part of their benefits, falls below that, they owe nothing. But a retiree with a substantial pension or large IRA withdrawals will still see part of their Social Security taxed, and the new deduction only reduces the bill.

Here is how it can play out. Take a hypothetical married couple, both over 65, with $40,000 in Social Security and a $30,000 pension. Under the usual test, $11,100 of their benefits is taxable, so their adjusted gross income is $41,100. Without the senior deduction, their $35,500 standard deduction would leave $5,600 taxed, about $560 in tax. With it, their deductions reach $47,500 and they owe nothing. Their benefits were still partly taxable; the deduction simply absorbed them.

2How the deductions stack at 65

There are three layers, and the last one is the new, temporary piece. For 2026:

Swipe sideways to see the whole table.

Put plainly, a single person 65 or older can have about $24,000 of adjusted gross income, and a couple about $47,500, before federal income tax begins, as long as their income is below the phase-out. Remember that only the taxable part of Social Security counts toward that figure. For many retirees whose income is mostly Social Security and a modest pension, that is more than they have.

The additional amount for age doubles if you are also blind, and it applies only if you take the standard deduction. A couple where only one spouse is 65 gets one additional amount and one senior deduction; the younger spouse qualifies in the year they turn 65.

3"You have to be on Social Security to get it."

No. Age is the test, not benefits. A 66-year-old who is still working and has not claimed Social Security qualifies just as fully as a retiree. For tax purposes you reach an age on the day before your birthday, so for tax year 2026 you count as 65 or older if you were born before January 2, 1962. Each spouse is tested separately, and a spouse who died during the year is judged by age on the date of death.

4"If I itemize, I lose it."

You lose the additional standard deduction for age, because it is part of the standard deduction. You keep the senior deduction, which applies either way. Picture a single 72-year-old with $22,000 of itemized deductions, more than her $18,150 standard deduction with the age amount: she itemizes, then adds the $6,000 senior deduction on top, for $28,000 in all, if her income is under $75,000.

5"Everyone gets the full $6,000."

Not above a certain income. The senior deduction shrinks by 6 percent of modified adjusted gross income above $75,000, or $150,000 on a joint return, and disappears entirely at $175,000 and $250,000. For most people, modified adjusted gross income is the same as adjusted gross income.

The reduction is gradual, so someone just over the line loses only a little. But in the four years the deduction lasts, a large IRA withdrawal, a Roth conversion or a capital gain can shrink it for that year. Spreading such income across years, or making charitable gifts directly from an IRA after 70 and a half, can keep more of it. Weigh that against other tax effects; the deduction is one factor, not the whole picture.

6"It will lower my Medicare premiums too."

It will not. The senior deduction is subtracted after your adjusted gross income is figured, on the way to taxable income, so it does not lower adjusted gross income itself. Several things are tied to that earlier figure or to modified adjusted gross income, and the senior deduction leaves them untouched:

• The test that decides how much of your Social Security is taxable.
• Medicare's income-related premium surcharges for Part B and Part D.
• Eligibility for Marketplace premium tax credits for anyone under 65 in the household.
• Many state income taxes, which start from federal adjusted gross income and set their own deductions.

The deduction lowers your federal income tax, and that is all it is designed to do.

7"It's permanent, and it takes care of itself."

Neither. The senior deduction covers tax years 2025 through 2028 and ends after that unless Congress extends it, so it is worth enjoying without building a long-term budget around it.

Claiming it takes a few steps. It goes on a new schedule filed with Form 1040, Schedule 1-A, which also holds the new deductions for tips and overtime. Married couples must file jointly to claim it, and each qualifying person's Social Security number valid for employment must be on the return; a taxpayer identification number is not enough. Withholding from Social Security, pensions or IRA withdrawals is not adjusted automatically either. If you have tax withheld or pay estimated tax, review the amount so you are not overpaying all year.

8Other tax breaks worth a look at 65 and older

• Medical expenses: if you itemize, unreimbursed medical costs above 7.5 percent of adjusted gross income are deductible, including Medicare premiums.
• Charitable gifts from an IRA: after 70 and a half, gifts sent directly from an IRA to charity are left out of adjusted gross income.
• The credit for the elderly or the disabled: a small credit for people with low income and limited Social Security.
• Free help: the IRS Tax Counseling for the Elderly program prepares returns at no cost for people 60 and older.

If Social Security is part of your income, our guide to how much Social Security you will get explains the benefit itself.

10Not tax advice

The senior deduction is scheduled for tax years 2025 through 2028 and could change, and later years' amounts are set by the IRS. Your total tax depends on all of your income, credits and deductions; this guide explains two deductions and does not estimate your tax.