No. Congress has not voted to eliminate taxes on Social Security, and benefits remain taxable in 2026 and 2027 under the same combined-income rules that have applied since the 1980s. What did change is a new deduction of up to $6,000 per person age 65 or older, created by the One Big Beautiful Bill Act for 2025 through 2028, which the IRS explains can be claimed whether or not you itemize. For many retirees, that deduction reduces or wipes out the tax on their benefits, but it is temporary and does not apply to everyone. Here is where things stand.
How Social Security Is Taxed Today
| Filing status | Up to 50% of benefits taxable | Up to 85% of benefits taxable |
|---|---|---|
| Single | Combined income $25,000 – $34,000 | Over $34,000 |
| Married filing jointly | $32,000 – $44,000 | Over $44,000 |
Combined income is your AGI plus tax-exempt interest plus half of your benefits. These thresholds are not indexed for inflation, so more retirees cross them every year. See our full guide to Social Security tax thresholds.
What the One Big Beautiful Bill Act Did
- Created an additional deduction of up to $6,000 for each taxpayer 65 or older ($12,000 for a married couple filing jointly if both qualify).
- Applies for tax years 2025 through 2028 only.
- Phases out when modified AGI exceeds $75,000 ($150,000 joint).
- Requires a valid Social Security number and, for married couples, a joint return.
- Is available to both itemizers and those who take the standard deduction.
The law did not change how much of your benefit is counted as taxable income. It lowered taxable income through a deduction. Retirees under 65, those with income well above the phase-out, and married people filing separately do not benefit.
Example: How the Senior Deduction Helps
A single 70-year-old receives $28,000 of Social Security and takes $24,000 of IRA withdrawals. Her combined income is $24,000 plus $14,000 (half of benefits), or $38,000, which is $4,000 over the $34,000 threshold.
- 85% of the $4,000 excess is $3,400.
- Add the lesser of $4,500 or half of her benefits: $4,500.
- Taxable Social Security: $7,900.
Her AGI is $31,900. She deducts the $16,100 standard deduction, $2,050 for being over 65, and the $6,000 senior deduction, a total of $24,150, leaving taxable income of $7,750 and federal tax of about $775. Without the senior deduction, taxable income would be $13,750 and the tax about $1,400.
Bills to Fully Eliminate Taxes on Social Security
Several bills have proposed to eliminate taxes on Social Security entirely. The best known is the You Earned It, You Keep It Act (H.R. 2909 in the House and S. 2716 in the Senate), introduced in 2025 by Rep. Angie Craig and Sen. Ruben Gallego. It would repeal federal income tax on Social Security benefits and offset the cost by applying the 12.4% Social Security payroll tax to wages above $250,000. As of mid-2026, the bills had been referred to committee but had not received a committee or floor vote.
Other proposals over the years have aimed to raise the thresholds or index them for inflation. None has become law.
Why Eliminating the Tax Is Complicated
- Trust fund revenue: Income taxes paid on benefits are credited to the Social Security and Medicare trust funds. Eliminating them would reduce that revenue unless replaced.
- Budget rules: Permanent tax changes must be paid for or add to the deficit, which makes full repeal costly.
- Who benefits: Lower-income retirees already owe little or no tax on benefits, so full repeal would mainly benefit middle- and higher-income retirees.
The long-term financing of the program is a separate debate. See whether Social Security will be reduced.
What Happens After 2028?
The senior deduction is scheduled to expire after the 2028 tax year. Unless Congress extends it, retirees who rely on it will see higher taxable income starting with their 2029 returns. Because the combined-income thresholds are fixed, the share of retirees who owe tax on benefits is likely to keep growing over time. Any effort to eliminate taxes on Social Security, extend the senior deduction or index the thresholds would require new legislation.
What You Can Do Now
- Claim the senior deduction on your 2025 through 2028 returns if you qualify.
- Use Roth withdrawals, qualified charitable distributions and timing of IRA withdrawals to manage combined income.
- Set up withholding on benefits with Form W-4V to avoid a surprise bill.
- Consider Roth conversions in lower-income years while the senior deduction is available, since future withdrawals from Roth accounts do not count toward combined income.
- Watch for legislative changes before 2028, when the senior deduction is scheduled to end.
Our guide to retiree taxes in 2026 covers other planning moves.
Frequently Asked Questions
Did Congress eliminate taxes on Social Security?
No. Benefits are still taxable under the combined-income rules. The 2025 law added a temporary $6,000 senior deduction instead.
Is Social Security tax-free after age 70?
No. Age does not change the rules, although the senior deduction applies to everyone 65 or older who qualifies.
When does the $6,000 senior deduction end?
After the 2028 tax year, unless Congress extends it.
What is the You Earned It, You Keep It Act?
A bill that would repeal federal income tax on Social Security benefits and apply Social Security payroll tax to wages over $250,000. It has not passed.
Final Thoughts
Efforts to eliminate taxes on Social Security have not become law, but the temporary senior deduction gives many retirees real relief through 2028. Plan around the rules that exist today and watch for changes in Congress.
Have questions about how this applies to your situation? Book a free consultation with Aric and get answers from a CPA.
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
