Trump says 88% of retirees will pay zero taxes on Social Security, calls it ‘the largest tax break in American history'

Core Points - The White House claims that the new tax law provides the largest tax break in American history for seniors, stating that 88% of Social Security recipients will pay no tax on their benefits due to the new deductions [5] - Experts from the Center for Budget and Policy Priorities (CBPP) argue that the White House's claims are exaggerated, indicating that only about 46% of older adults will benefit from the new deduction, and that many will still owe taxes on their benefits [10][4] - The new senior deduction of up to $6,000 per person is temporary and only applicable until 2028, which raises concerns about the long-term stability of Social Security and Medicare trust funds [11][14] Tax Deductions and Eligibility - Seniors aged 65 and above can claim a new deduction of up to $6,000, with couples filing jointly eligible for up to $12,000 [3] - Full deductions are available only to individuals earning $75,000 or less, phasing out completely at $175,000; for joint filers, the phase-out starts at $150,000 and disappears at $250,000 [2] - Approximately 64% of Social Security recipients already paid no federal tax on their benefits before the new law, limiting the impact of the new deductions [2] Impact on Social Security - The CBPP estimates that the tax deductions could reduce federal tax revenue from Social Security benefits by $30 billion annually, potentially accelerating the insolvency of the Social Security retirement fund to 2032 [11][12] - Upon insolvency, beneficiaries could face an across-the-board benefit cut of around 24%, which is deeper than current law projections [12][13] - The new law may provide short-term tax relief for some seniors but poses risks to the long-term stability of Social Security and Medicare [14][15]