- President Trump’s campaign promise to eliminate taxes on Social Security benefits faces a scaled-back reality in new House legislation.
Instead of a full exemption, the bill offers a temporary $4,000 tax deduction for seniors 65 and older, leaving many still paying taxes on their benefits.
The measure aims to balance political appeal with budget constraints, but critics say it falls short of the president’s vow.
President Trump’s campaign promise to eliminate taxes on Social Security benefits has morphed into a more modest proposal—one that offers a temporary tax break to some seniors but stops well short of making Social Security tax-free.
A compromise, not a repeal
The tax-and-spending bill passed by the Republican-led House last week includes a new $4,000 deduction for seniors aged 65 and older. While this measure aims to provide some tax relief for older Americans, it does not repeal the federal income taxes on Social Security benefits, as Trump had previously pledged.
“It’s a far cry from making Social Security tax-free,” said Tom O’Saben, director of government relations at the National Association of Tax Professionals.
Who benefits—and who doesn’t
The deduction, available from tax years 2025 through 2028, applies to both standard and itemized filers:
Full $4,000 per-person deduction for single filers earning up to $75,000 and joint filers up to $150,000.
Phased out at a rate of $40 per $1,000 over the income threshold.
Seniors also retain existing deductions: $2,000 for single filers and $1,600 per person for joint filers.
Combined with increased standard deductions ($16,000 for singles, $32,000 for couples), a married senior couple could deduct up to $43,200 under the new rules.
However, many seniors won’t see significant savings. Low-income retirees already pay no federal income taxes, and high earners might exceed the eligibility cap. Additionally, the deduction does nothing for people under 65 who receive disability or survivor benefits.
Those delaying Social Security to age 70, or who don't qualify for benefits, may benefit more from the deduction than from an outright exemption of Social Security taxes.
Politics and budget constraints
Two main factors led lawmakers to temper Trump’s promise:
Budget impact: A full repeal of taxes on Social Security benefits would cost roughly $100 billion annually. The proposed deduction keeps the price tag around $18 billion per year.
Legislative limits: The fast-track budget reconciliation process restricts changes to Social Security trust funds, which are partly funded by taxes on benefits.
Despite the limitations, House Republicans rallied around what Trump has dubbed his “one big, beautiful bill.” The Senate, where concerns about the deficit loom larger, is expected to be a tougher battleground for the legislation.
Still, few lawmakers have spoken out against the deduction, likely due to its alignment with Trump’s campaign messaging. “It’s politically unpopular to be the person to say ‘No tax relief for seniors’ when the president promised it,” said Alex Durante, a senior economist at the Tax Foundation.
A closer look at the numbers
For many middle-income seniors, the deduction provides modest help. A married couple with $48,000 in Social Security and $50,000 in pension income currently pays tax on two-thirds of their benefits. Under Trump’s original promise, their tax savings could have reached $3,500. With the House bill, they would save about $1,200.
While the bill delivers targeted relief, it falls short of the sweeping reform many retirees hoped for. The fate of the measure now rests with the Senate, where fiscal hawks and political pragmatists must weigh Trump’s promises against the realities of the federal budget.