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I have been following the passage of the new bill signed today. I thought the deduction was 6K for couples, but it is per person. Here is information on the specifics from an AI source:
The (bill) includes a significant tax break for older Americans, specifically a new $6,000 “bonus” deduction for those 65 and older. This deduction is targeted at those with modified adjusted gross incomes up to $75,000 for individual filers and $150,000 for joint filers. The deduction phases out at higher income levels, and it is not available for those earning more than $175,000 (or $250,000 for couples).
My wife and I will be able to take full advantage of this deduction. I will be increasing my wife’s Roth conversions by another 12K and still stay in the 12% tax bracket. This will assist in trying to convert the total amount of her traditional IRA before she runs 70 in 3 1/2 years. The deduction is through 2028. I just hope we won’t pay for it in the future with reduced Social Security checks in the future, as it has been reported these payments will cause the trust fund to run dry six months earlier then current projections.
It also pains me that so many in the crypto and tech communities use social media to spread the lie that Social Security is a Ponzi scheme.
It’s a catchy line but so wrong.
Because, unlike a Ponzi scheme, it’s legal, transparent, backed by US law, adjustable by Congress, and backed by taxes!
Ponzi schemes are designed to collapse and enrich the creator. Social Security is designed to last and support retirees.
There is so much misinformation information it is depressing what people willingly accept without any effort to check the facts.
David Enna wrote an article on topic at tipswatch.com that is worth a read.
I received an email from My Social Security about the new legislation on July 3. It contained inaccurate information and was political in tone.
“The bill ensures that nearly 90% of Social Security beneficiaries will no longer pay federal income taxes on their benefits, providing meaningful and immediate relief to seniors who have spent a lifetime contributing to our nation’s economy.
The new law includes a provision that eliminates federal income taxes on Social Security benefits for most beneficiaries, providing relief to individuals and couples.”
Did anyone else get this?
I plan to call my Representatives this week.
The new phaseouts create a new temporary marginal tax rate 6% higher. When will Congress stop making taxes more complicated?</