Additional Deduction for Seniors under the One Big Beautiful Bill Act.

One of the largest changes for the upcoming tax season (2025 tax year) is the additional deduction for seniors. This deduction is unique as it can stack on top of the regular standard deduction and the itemized deduction. If you and your spouse are over 65 you will get $6,000 each.

If you are married you must file jointly to receive the deduction.

You can still take the increased standard deduction for being over 65 as well. For example if you are single you get a standard deduction of $15,750 for 2025. Then you would get an additional standard deduction of $2,000 for being over 65 (married couples only get $1,600 each) then another new additional $6,000 for a total deduction of $23,750.

If you are marred, both over 65 and take the standard deduction you will have a total deduction of up to $46,700. You could take $46,700 out of a traditional IRA and pay zero taxes on it.

The deduction phase out begins at $75,000 for single/head of household or $150,000 for married filing joint. Complete phase out at $175,000 for single filers and $250,000 for married filing joint filers. It is unfortunate the threshold is not doubled for married filers. There are adjustments that can lower your income so you may still qualify even if you make slightly above these amounts and nontaxable income that is not included either. For example tax exempt interest, and distributions from ROTH accounts do not get included in your income for purposes of this phase out.

This new deduction is set to expire 12/31/2028.