Introduction
Great news for seniors: a generous new tax deduction kicks in for the 2025 tax year, offering welcome relief to eligible older taxpayers.
What Is the Senior Bonus Deduction?
As part of the One Big Beautiful Bill Act passed in July 2025, taxpayers aged 65 or older can now claim a bonus deduction of up to $6,000 for individuals or $12,000 for married couples where both spouses qualify. This deduction applies whether you itemize or use the standard deduction.
How It Stacks Up for 2025
- Standard deduction: seniors already benefit from an additional $2,000 (single) or $1,600 per spouse (married) on top of the base standard deduction.
- Plus the new bonus: when combined, a single senior could deduct up to $6,000 plus the usual senior addition. In total, a single filer might see a deduction as high as $21,750, while married couples could see totals up to $43,500.
Income Limits & Phase-Out
This deduction is not unlimited. It phases out based on Modified Adjusted Gross Income (MAGI):
- Single filers get the full deduction if MAGI ≤ $75,000.
- Married couples filing jointly get the full $12,000 if MAGI ≤ $150,000.
- Phase-out occurs—for singles up to MAGI $175,000; for couples up to $250,000—with the deduction reducing by around 6% per dollar over the threshold.
Temporary Nature & Planning Tips
The deduction is temporary — available only for tax years 2025 through 2028, unless extended. So, it is key for seniors and their advisors to plan early. Strategies like managing MAGI through charitable giving, delaying income, or boosting deductions could help preserve more of the benefit.
Note on Social Security Benefits
Contrary to some claims, this rule does not eliminate taxes on Social Security benefits. It simply lowers taxable income overall, which may reduce how much Social Security is taxed—but it does not change the taxability rules themselves.
Conclusion
The “Senior Bonus Deduction” provides meaningful tax relief for many seniors. If you are 65 or older, this is a benefit worth exploring with your tax advisor, especially since it is time limited. Be proactive to maximize your return for 2025 through 2028.