Did you know that two laws passed in 2025 could significantly change how Social Security benefits are taxed in the year ahead, especially for retirees and near-retirees?
The first is the One Big Beautiful Bill, which introduces a new senior deduction worth up to $6,000 for individuals age 65 and older. This deduction is available through 2028 and is designed to provide additional tax relief later in retirement. To qualify for the full amount, income must be at or below $75,000 for single filers or $150,000 for married couples filing jointly. The deduction gradually phases out as income rises above those thresholds.
At the same time, the Social Security Fairness Act may have the opposite effect for some households. By restoring full benefits to certain pension recipients who previously faced reductions or exclusions, the law can increase total taxable income. In addition, some beneficiaries will receive lump sum payments retroactive to January 2024. While welcome, these payments could push more Social Security income into taxable territory for the year they are received.
To help track these changes, Social Security tax forms for 2025 benefits will be available online starting December 25, with paper copies mailed by late January. Form SSA-1099 and, for some recipients, SSA-1042S summarize total benefits received during the year and are essential for determining any federal tax owed.
Because these rules apply differently to every household, understanding how they affect your broader financial picture is more important than ever.
Source: https://www.cnbc.com/2025/12/10/social-security-tax-bills.html
About Terrell Dinkins, MBA, ChFC®, RICP®
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Terrell Dinkins, MBA, ChFC® , RICP® is an investment adviser representative of and offers investment advisory services through OBN Wealth Advisors, LLC, a registered investment adviser offering advisory services in the State of Georgia and other jurisdictions where registered or exempted. Main Office: 950 Eagles Landing Pkwy, Suite 216, Stockbridge, GA 30281. Tel: 404-723-9780. Website: OBN Wealth Advisors. Picture courtesy of Canva.