In case you are one of many greater than 60 million individuals who obtain Social Safety advantages, you will have obtained an attention-grabbing message final week. That’s as a result of the Social Safety Administration (SSA) reportedly despatched an electronic mail to tens of millions of beneficiaries stating that the newly enacted “One Huge Stunning Invoice Act” (OBBBA) would “eradicate federal earnings taxes on Social Safety advantages for many beneficiaries.”
In that communication, a portion of which was additionally posted to the company’s weblog, SSA Commissioner Frank Bisignano described the change as a “historic step ahead for America’s seniors.”
The e-mail went on: “The invoice ensures that just about 90% of Social Safety beneficiaries will not pay federal earnings taxes on their advantages, offering significant and rapid aid to seniors who’ve spent a lifetime contributing to our nation’s economic system.”
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Nevertheless, for the reason that precise particulars of the brand new GOP mega laws current a extra advanced image, some criticized the correspondence for being inaccurate, political, and complicated.
Right here’s what you might want to know concerning the electronic mail and what’s actually occurring with taxes on Social Safety advantages in 2025.
July 3 electronic mail from Social Safety about OBBBA tax cuts
The SSA’s July 3 electronic mail introduced that the One Huge Stunning Invoice Act (signed into regulation by President Donald Trump on July 4) would basically eradicate federal earnings taxes on Social Safety advantages for many recipients.
Particularly, the letter leaned into the notion that just about 90% of beneficiaries would not pay federal taxes on their advantages, framing the OBBBA as a significant win for older adults in the USA.
“The brand new regulation features a provision that eliminates federal earnings taxes on Social Safety advantages for many beneficiaries, offering aid to people and {couples}. Moreover, it offers an enhanced deduction for taxpayers aged 65 and older, guaranteeing that retirees can hold extra of what they’ve earned,” the e-mail reads.
Commissioner Bisignano went on to state within the electronic mail: “For practically 90 years, Social Safety has been a cornerstone of financial safety for older Individuals. By considerably lowering the tax burden on advantages, this laws reaffirms President Trump’s promise to guard Social Safety and helps be certain that seniors can higher benefit from the retirement they’ve earned.”
So what’s the problem? Some recipients reportedly felt the tone and content material of the e-mail urged a sweeping and everlasting change to Social Safety taxation.
The SSA’s use of “eliminates federal taxes on Social Safety advantages” might create the impression of a everlasting and complete SS tax repeal, which the OBBBA doesn’t present. The invoice doesn’t amend the tax code to take away taxes on Social Safety advantages.
- Rep. Frank Pallone, a Democrat from New Jersey, took to X (previously Twitter) to denounce the e-mail, calling it “a lie” and expressing that “Trump hijack[ed] a public establishment to push blatant misinformation.”
- Jeff Nesbit, who beforehand served as deputy commissioner on the SSA, additionally posted on X, stating that he had by no means seen the company difficulty such a “blatant political assertion,” and described the transfer by the Trump administration as “unconscionable.”
Some advocacy teams raised comparable alarms. In response to USA In the present day, Alex Lawson, govt director of nonprofit social welfare group Social Safety Works, described the SSA’s electronic mail as “fully unprecedented” and mentioned, “[It] represents a major breach of belief.”
Additionally, given the prevalence of Social Safety phishing scams that use pressing and official-looking emails to focus on retirees, the July 3 SSA electronic mail could have caught some recipients off guard. (Extra on that under.)
Reality: The OBBBA doesn’t change Social Safety taxation straight and makes no modifications to the Social Safety program. The brand new regulation, enacted on July 4, 2025, offers a brief, income-based bonus over-65 tax deduction fairly than a full repeal of Social Safety profit taxes. That deduction increase might, for some, not directly influence how a lot Social Safety earnings is topic to tax.
*Up to now, there has additionally been no public assertion from the SSA or the administration straight addressing whether or not some beneficiaries could have misunderstood the OBBBA change, or whether or not the language used within the electronic mail might have led to such a misinterpretation.
Tax modifications behind the Social Safety Administration electronic mail
As Kiplinger has reported, the OBBBA does introduce a brief bonus tax deduction for older adults.
Particularly:
- People aged 65 and older can declare a $6,000 deduction if their earnings is $75,000 or much less.
- Married {couples} (65+) submitting collectively could declare as much as $12,000 if their mixed earnings doesn’t exceed $150,000.
- The deduction phases out for incomes above these limits, disappearing fully at $175,000 for people and $250,000 for {couples}.
- This bonus over-65 deduction is ready to run out after 2028 until Congress takes motion.
The bonus deduction, which can stack on high of the present further normal deduction for these over 65, might scale back taxable earnings for a lot of age 65 and older. That might probably end in no federal tax legal responsibility on Social Safety advantages.
Nevertheless, it’s vital to understand that the underlying tax guidelines for Social Safety advantages stay unchanged.
Moreover, as Kiplinger has reported, it’s price noting that the finances reconciliation course of used to move the OBBBA, which required solely GOP help, prohibited direct modifications to Social Safety’s core construction.
Who advantages from the brand new over-65 bonus tax deduction — and who doesn’t
The “90%” determine cited by the SSA possible refers to estimates that almost all taxpayers age 65 or older will owe little or no tax with the brand new bonus normal deduction. However that doesn’t apply to all Social Safety beneficiaries.
For instance, people below the age of 65 don’t qualify for the deduction, and higher-income retirees will proceed to pay taxes on their advantages on account of how Social Safety taxes are calculated.
The brand new bonus tax deduction primarily advantages these aged 65 and older with reasonable or decrease incomes. These with incomes above the phase-out thresholds, in addition to youthful beneficiaries who start accumulating Social Safety earlier than age 65, are excluded. Because of this whereas many might see some tax aid, it isn’t common.
Moreover, the bonus tax break is ready to run out after 2028 until Congress renews it. For the reason that aid is just not assured long-term, retirees’ tax conditions might change sooner or later.
Social Safety electronic mail scams vs. official messages
It is also price noting that for years, Social Safety recipients have been warned about electronic mail scams and phishing makes an attempt, with official recommendation typically stressing that the company hardly ever contacts individuals by electronic mail.
That warning has made some beneficiaries understandably cautious of surprising emails or different messages claiming to be from the Social Safety Administration.
So, when the Trump administration’s SSA despatched its uncommon July 3 electronic mail, some recipients might have been uncertain whether or not it was a real alert or a rip-off.
Bear in mind: When you obtain a suspicious electronic mail about your SS advantages, the most secure course is to keep away from clicking any hyperlinks or offering private data.
As a substitute, confirm the message by contacting the Social Safety Administration straight via its official channels.
Taxes on Social Safety advantages: Backside line
Social Safety beneficiaries have to know that whereas the OBBBA can provide tax aid to some, it doesn’t eradicate Social Safety taxes, straight or completely.
However which may not be a problem for some. For instance, a 67-year-old retired monetary govt reportedly expressed appreciation, telling the Wall Road Journal, “I’d welcome any aid on taxes… It’s nonetheless in need of my Social Safety tax nirvana of getting it fully tax-free.”
What are you able to do? Overview your earnings scenario and seek the advice of tax and monetary planning professionals if wanted to know how the brand new bonus over-65 tax deduction could have an effect on your tax filings.
