Millions of U.S. Retirees Qualify for Senior Deduction Under Big Beautiful Bill

The One Big Beautiful Bill, passed under President Trump's administration in 2025, significantly expands federal tax relief for seniors by exempting most Social Security benefits from federal income taxation. This legislation raises the proportion of retirees not paying federal taxes on Social Security from 64% to 88%, benefiting over 51 million seniors nationwide and providing a new senior tax deduction of $6,000 for individuals and $12,000 for married couples. States such as Arkansas, Arizona, New Jersey, and Maryland have substantial senior populations expected to gain from this policy, with projected real wage increases ranging from $2,900 to $9,000 and take-home pay boosts between $6,400 and $12,700. Alongside tax relief, these states will also see the addition of thousands of new Opportunity Zone housing units aimed at supporting senior housing in underserved areas. However, the deduction phases out at higher income levels and is not refundable, which means low-income seniors who do not currently pay federal taxes on Social Security will not receive additional financial benefits. This legislation marks a historic tax break for America's seniors but leaves out some of the most vulnerable who already have minimal tax burdens.