Believe it or not, even the Internal Revenue Service (IRS) is capable of giving a pleasant surprise from time to time. The IRS has confirmed a series of changes to tax deductions for adults over the age of 65 —if they qualify. And yes, it looks like it will be more generous when it comes to deductions.
Two parallel changes, to be precise, will take effect simultaneously. First is the inflation adjustment. The IRS must make yearly small increases to deductions in order to prevent inflation from reducing the value of taxpayers’ money.
Second, we have the new tax creditIt: a $6,000 discount approved last july in Congress. This comes from the legislation born as the “One, Big, Beautiful Bill Act” (OBBB). Apart from having a ring similar to the “Big, Bad Wolf”, the purpose of this part of the OBBB is to provide substantial tax relief targeted at older adults. After all, if anyone lives on a fixed, small income, it’s senior citizens.
Annual adjustment
First, let’s review the most basic concept: the standard deduction. This is a fixed dollar amount that you subtract from your total income before the IRS calculates how much tax you owe. It’s the recommended amount you have to put away before taxes to mke sure you don’t have the IRS banging on your door.
For the vast majority of the population, this standard deduction saves them from the cumbersome process of itemizing every expense receipt. Due to inflation adjustments, the base figures for this deduction are rising through 2026: for married couples filing jointly, the deduction will rise to $32,200 (up $700 from last year). For singles, the figure rises to $16,100. For those who qualify as Head of Household (HOH), the deduction will rise to $24,150.
In addition to the basic standard deduction, there is an extra deduction. This deduction is exclusively for those who are 65 or older or blind. For single seniors, the extra deduction will rise to US$2,050. For married couples, the extra deduction per individual will rise to US$1,650. If both spouses qualify, the total is an extra US$3,300 for this item.
The $6,000 Super Deduction
Let’s move on to the real change, the new OBBB bonus. The most important detail of this new law is the Amount per Person: an extra $6,000 deduction is added for each person aged 65 or older who meets the requirements. For a married couple where both qualify, the total additional deduction will be $12,000.
However, the best part of this super deduction is its flexibility. While the deduction traditionally only applies if you take the standard deduction, this $6,000 bonus applies even if you itemize your deductions. If, for example, you have medical bills or a mortgage you are taking care of, you can now deduct them and still get the $6,000 deduction.
However, all good things must come to an end, and this bonus is temporary: it will only be available for the 2025 to 2028 tax years. In other words, it will expire in 2029.
On the other hand, there is a phase-out that affects high-income taxpayers. The credit will begin to be reduced for those with a modified adjusted gross income above $75,000 (if single) or $150,000 if married.
Some respite in this economic landscape
Although it seems like a band-aid on the large wound that is the American economy at the moment, the new deduction will help many senior citizens reduce —or even eliminate— the taxes they pay on a portion of their Social Security benefits. This is nothing more than tax relief designed for retirement. Although it will only last a few years until 2028, the good news is that it is very easy to obtain the deduction.
The process is quite automated; once you check the “65+” box on Form 1040-SR, which is the simplified version for older adults, you will be entitled to the $6,000 deduction automatically. Consult a tax professional for more information.
