Posted in GD, posting here also for those who stick to the lounge - 2025 tax information

[LuckyCharms]

I've seen a lot of questions regarding taxable Social Security for 2025, as well as the new $6,000 deduction for seniors.

Summary - The long calculation to determine the taxable portion of your Social Security has not changed. However, there is a new "bonus deduction" of $6,000 per person ($12,000 if filing jointly). This $6,000 is not an extra $6,000 in your pocket. It is a DEDUCTION, not a CREDIT. The benefit to you is $6,000 X your tax rate.
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Here's a copy of what I posted in GD:

I finished and submitted my 2025 federal and state income tax filing the other day. Both were filed electronically, and accepted by both the IRS, and the state, within a matter of hours.

For those SENIORS who are wondering if the taxable Social security calculation has changed for 2025...it has not. This calculation remains the same as prior years. I know this because I maintain an excel spreadsheet that mimics the calculation, so I compute the taxable portion of my Social Security independently, and then compare my result to the result shown on Turbotax. The results of the two calculations were exactly the same.

HOWEVER, there is a new DEDUCTION for seniors of $6,000 PER PERSON (so, $12,000 if you are filing a joint return) as long as you are under certain income limits.

So if you are roughing out your tax liability (or refund), here is how this works:

Wages and other income (pensions, IRA withdrawals, etc.)

Plus taxable portion of Social Security (again, the calculation of taxable potion is unchanged. I think the MAXIMUM of your Social Security that is taxed is 85% of the amount of Social Security that you received in 2025, but it can be far less than 85%, depending on the amount of your other income)

Equals adjusted Gross Income

Minus "Traditional" standard deduction (or, itemized deductions if you have enough deductions to itemize)

Minus "additional" deduction ($6,000 if single, $12,000 if filing jointly)

Equals taxable federal income before direct tax credits
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Note that the $6,000 per person is a DEDUCTION that reduces your taxable income, and is NOT a credit where you receive an additional $6,000. The amount that this benefits you is $6,000 x your effective tax rate.

EDIT TO ADD: Only those age 65+ receive the $6,000 per person "bonus deduction".

[rampartd]

1. is it a standard deduction or must i itemize?

[LuckyCharms]

2. You can use the $6,000 "bonus deduction" IN ADDITION to either the

standard deduction, or your itemized deductions.

I'm pretty sure about this, because the 1040 form has two separate line items:

Standard or itemized deductions
"Additional" Deductions (this is the $6,000)

The total of these two lines equals your total deductions.

[rampartd]

3. thanks. schedule a is more trouble than it is worth UNLESS that is what it takes

[LuckyCharms]

4. I don't have enough itemized deductions to get higher than

the standard deduction amount, so I have to use the standard deduction by default.